- December 28, 2011
- All Illinois Issuing Offices
- Illinois Residential Real Property Transfer on Death Instrument Act
Public Act 097 – 0555, titled the "Illinois Residential Real Property Transfer on Death Instrument Act" (the "Act") becomes effective January 1, 2012. It is codified in §755 ILCS 27/1 et seq. Below are the major highlights of the Act.
- The Act sets forth pertinent definitions, including but not limited to, the definition of "Residential Real Estate."
- The Act is applicable only to a transfer of residential property made before, on, or after January 1, 2012 by an owner dying on or after January 1, 2012.
- Residential real estate may be transferred by a transfer on death instrument to one or more beneficiaries as owners, concurrently or successively, and upon any contingency, effective at the owner's death.
- A transfer on death instrument is revocable even if the instrument or another instrument has a contrary provision.
- A transfer on death instrument is non-testamentary and is subject to all other laws governing or affecting non-testamentary instruments.
- The capacity required to make or revoke the instrument is the same as that required to create a will. Unless expressly granted in a power of attorney or other instrument creating an agency, an agent or attorney-in-fact does not have the power to create or revoke a transfer on death instrument.
- A transfer on death instrument does not affect the rights of the owner or any transferee, lien holder, mortgagee, option holder or grantee, secured or unsecured creditor, or future creditor, or create a legal or equitable interest in the designated beneficiary or any creditor or claimant of the designated beneficiary. A designated beneficiary takes the real property subject to any matters prior to the death of the owner, including but not limited to a contract for the disposition of the real estate.
- The Act provides default rules regarding the transfer of interest in the real estate if the designated beneficiary fails to survive the owner, except as otherwise provided in the transfer on death instrument, the Act, the Probate Act of 1975 or any other act applicable to nontestamentary instruments.
- Joint owners may execute or revoke a transfer on death instrument, and execution of the transfer on death instrument shall not sever a joint tenancy or tenancy by the entirety.
- The Act requires and provides a sample document for a Notice of Death Affidavit and Acceptance of Transfer on Death Instrument, which must be recorded within 30 days of the death of the owner. Otherwise, the personal representative of the owner’s estate may take possession of the real estate. If a Notice of Death Affidavit and Acceptance of Transfer on Death Instrument is not recorded within 2 years of the death of owner, the transfer on death instrument is void and ineffective to transfer the property, and the property passes to the owner's estate.
- An action to set aside or contest the validity of a transfer on death instrument shall be commenced within the earlier of 2 years of the date of death of the owner or 6 months from the date of the issuance of letters of office.
- A transfer on death instrument transfers residential real estate without covenant or warranty of title even if the instrument contains a contrary provision.
- A transfer on death instrument or revocation instrument must be drafted by a licensed
attorney or by the owner of the subject land. Illinois
Click here for Guidelines for a transfer on death instrument.
It is important that you contact a local underwriter if you have any questions pertaining to a transfer on death instrument, the revocation of a transfer on death instrument or a Notice of Death Affidavit and Acceptance of Transfer on Death Instrument, or any other concern involving these issues.
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