A Texas transfer on death deed is a recorded document that names who inherits your real estate when you die and moves the property to that person automatically, without probate. Texas Estates Code Chapter 114 has authorized these deeds since September 1, 2015.1State of Texas. Texas Estates Code ES 114.051 – Transfer on Death Deed Authorized You keep full control of the property during your lifetime, you can revoke the deed anytime, and the filing fee is usually under $40.
How It Works While You Are Alive
A transfer on death deed (often shortened to TODD) has no effect on your ownership until you die. You can sell the property, refinance it, lease it, or tear the house down and rebuild. The beneficiary you name has no ownership interest, no right to use the property, and no say in what you do with it.
The deed is a nontestamentary instrument, meaning it operates independently of your will.2State of Texas. Texas Estates Code Chapter 114 – Transfer on Death Deed If your will leaves the house to your daughter but your TODD names your son, the TODD controls the house. That independence is the whole point, but it also means your will and your TODD need to agree, or you need to be sure which one you want to win.
Revocability is absolute. Even if the deed itself says it can’t be revoked, that language is unenforceable under Texas law.2State of Texas. Texas Estates Code Chapter 114 – Transfer on Death Deed You can always change your mind.
What the Deed Must Contain
A valid TODD needs:
- Your full legal name and address as the current owner (the statute calls you the transferor).
- Each beneficiary’s full legal name and address. You can name more than one, and you can name an alternate in case your first choice dies before you do.
- The legal description of the property. This is the formal description on your current deed, referencing survey information, lot and block numbers, or metes and bounds. A street address alone is not enough. You can pull the legal description from your existing deed or from county property records.
- The county where the property sits, because that is where the deed gets recorded.
Texas Estates Code Section 114.055 provides a statutory form you can use as a template.2State of Texas. Texas Estates Code Chapter 114 – Transfer on Death Deed Using it closely reduces the risk of a technical defect.
Signing, Notarizing, and Recording
You must sign the deed and acknowledge your signature before a notary public. The beneficiary signs nothing. Notary fees in Texas are typically under $10 per signature.
Then comes the step people miss. You must record the deed with the county clerk in the county where the property is located, and you must do it before you die. A signed, notarized TODD that never gets filed is legally worthless.2State of Texas. Texas Estates Code Chapter 114 – Transfer on Death Deed It doesn’t matter what your intent was. If the clerk never received it, the transfer never happens.
Filing fees vary by county but stay modest. In Travis and Dallas counties, the standard fee is $25 for the first page and $4 for each additional page.3Travis County Clerk. Recording Fee Information4Dallas County. Dallas County Clerk Recording Division – Filing Fees and Payment Information Most TODDs run only a few pages, so the total cost to file is usually under $40.
What Happens When You Die
The property passes to your named beneficiary automatically. No probate petition, no court hearing, no executor involvement. The beneficiary does need to update the public record so the county knows who now owns the property.
The beneficiary files an Affidavit of Death with the county clerk in the county where the property is located. The affidavit is signed before a notary and typically includes the beneficiary’s name, the legal description of the property, the recording details of the original TODD (volume and page number or instrument number), and the date and place of your death. The beneficiary also needs a certified death certificate before selling the property or using it as loan collateral.
The 120-Hour Survival Rule
The beneficiary must outlive you by at least 120 hours (five days) to inherit through the TODD. If the beneficiary dies within that window, the law treats the beneficiary as having died before you.2State of Texas. Texas Estates Code Chapter 114 – Transfer on Death Deed This keeps the property from passing to someone who is effectively dying at the same time, which would only trigger a second probate.
If the Beneficiary Dies First
If your named beneficiary predeceases you, the TODD does not pass the property to the beneficiary’s heirs. The deed simply fails to transfer. An alternate beneficiary, if you named one, takes the property instead. If you named no alternate, or the alternate also died, the property falls back into your estate and passes through your will or, without a will, through Texas intestacy rules.
Reviewing your TODD after a death in the family, a divorce, or a serious falling-out is worth the effort. Circumstances that made a beneficiary the right choice can change.
Revoking or Changing the Deed
You can revoke or change your TODD at any time during your lifetime, and no language in the deed can override that right.2State of Texas. Texas Estates Code Chapter 114 – Transfer on Death Deed You have two options:
- Record a new TODD that expressly revokes the earlier one. This works well when you want to swap beneficiaries.
- Record a separate revocation instrument. This is the cleaner route when you want to cancel the arrangement without replacing it.
Either way, the revocation must be signed, notarized, and recorded with the county clerk before you die. An unrecorded revocation has no effect. If you signed a revocation but it never reached the clerk, the original TODD stands and the property goes to the beneficiary you meant to remove.
If the property is owned by joint owners with right of survivorship, all living joint owners must agree to revoke a TODD they signed together.2State of Texas. Texas Estates Code Chapter 114 – Transfer on Death Deed One joint owner cannot cancel it alone.
Mortgages, Liens, and Creditor Claims
A TODD does not clear debts attached to the property. Your beneficiary takes the real estate subject to every mortgage, lien, tax obligation, and encumbrance in place when you died. If you owed $180,000 on a mortgage, the beneficiary inherits that obligation along with the property.2State of Texas. Texas Estates Code Chapter 114 – Transfer on Death Deed For purposes of priority against competing claims, the TODD is treated as having been recorded at the moment of your death, not when you originally filed it.
Beneficiaries should plan to continue payments, refinance, or sell the property to satisfy any secured debt. The mortgage doesn’t vanish because probate was skipped.
Federal Tax Basis and State Taxes
Property received through a TODD qualifies for a stepped-up basis under federal law. The beneficiary’s cost basis resets to the property’s fair market value on the date of your death.5Office of the Law Revision Counsel. 26 U.S. Code 1014 – Basis of Property Acquired From a Decedent If you bought a house for $120,000 thirty years ago and it’s worth $400,000 when you die, your beneficiary’s basis is $400,000. A quick sale near that price produces little or no capital gains tax. Without the step-up, the taxable gain would be $280,000.
Texas has no state income tax and no state estate tax, so the transfer itself triggers no state-level tax.
Medicaid Estate Recovery
Under current Texas law, property that passes through a TODD is excluded from Medicaid estate recovery. If you received Medicaid long-term care benefits during your lifetime, the state can seek reimbursement from your estate after your death, and your home is often the largest asset available. A TODD moves the property out of the estate before recovery efforts begin. This exclusion reflects current law and could change if the legislature amends the relevant statutes.
What a TODD Cannot Do
A TODD only works for real property: land, houses, condominiums, and buildings. Bank accounts, vehicles, retirement accounts, and personal belongings need other tools such as payable-on-death designations, beneficiary forms, or a will.
Texas is a community property state, which complicates things when the property was acquired during marriage. Community property belongs to both spouses equally, and one spouse trying to transfer it through a TODD without the other creates serious legal problems. Married owners should include both spouses in the process when community property is involved.
A TODD also is not a full estate plan. It handles one asset. Guardianship of minor children, healthcare directives, personal property, and anything else you own still require separate planning.