How to Transfer a Property Title to Heirs

Birthday car

If you wish to transfer property to your heirs, you can gift the property to them in your last will and testament or you can transfer the property to them while you are still alive (in which case they are known as "beneficiaries) by meeting the three legal requirements for an inter vivos gift: donative intent, acceptance, and delivery.

Things You'll Need

• Property deed or vehicle title
• Photo ID

Instructions

1. Write down a description of the property that is particular enough to distinguish it from all other similar properties. If you are gifting a car, for example, make sure to include the Vehicle Identification Number. If you are gifting real estate, use the plat number recorded at the county land recorder's office (not the street address).

2. Draft a written statement of your intention to make an inter vivos gift to the beneficiary you have selected, incorporating the description of the property you incorporated in step one. Sign this document in the presence of a notary public (you will need to present a photo ID). To satisfy the intent requirement for an inter vivos gift, it is important that your statement express a clear intent to make a gift.

3. Create a written acceptance statement, and have the beneficiary sign it in the presence of a notary public. This statement only needs to convey a clear intent on the part of the beneficiary to accept the gift without reservations.

4. Draft a warranty deed in which you transfer the property to the beneficiary for a consideration of zero (for more information about transferring real estate, see Resources section). It is best to physically hand this document to the recipient in order to satisfy the delivery requirement of inter vivos gifts. If you are gifting a vehicle, hand over the title certificate.

5. Record the transfer of title with the appropriate local government subdivision. In the case of a real estate transfer, this subdivision is usually the county land recorder's office. In the case of the transfer of a vehicle, this subdivision is usually the local office of the state Department of Motor Vehicles. You will have to fill out an application and pay a filing fee. If the sales price is required, you should simply list it as zero. Some states have special forms to be used in the case of gifts.

6. Have the beneficiary obtain title insurance, if you are transferring real estate. This will ensure that the property has marketable title, so that it can be bought and sold in the future. Many states require emissions standards checks and other formalities to be performed before they will issue a new vehicle title.

Tips & Warnings

• Certain trust arrangements will allow you to transfer control over your property to a beneficiary without having to pay gift tax. This will require the appointment of a trustee to manage the trust. If the amount of your gift tax is small, however, it might not be worth the expense of creating the trust. Consult with an attorney for details on how to structure an irrevocable trust.

• If the value of your gift is more than $26,000, you may be liable for the IRS gift tax (depending on your relationship with the beneficiary). This will require you to fill out a separate gift tax return.

References

• University of Victoria Faculty of Law: Requirements for a Valid Inter Vivos Gift
• This Matter: Real Estate Title Transfer
• IRS: Frequently Asked Questions on Gift Taxes

Resources

• Law Smart: Sample Warranty Deed