A transfer on death deed in Montana lets you name someone to inherit your real property when you die, with the property passing outside probate. Montana adopted the Uniform Real Property Transfer on Death Act in 2019, and the rules sit in Title 72, Chapter 6, Part 4 of the Montana Code Annotated. The deed costs little to set up, has no effect on your property rights while you’re alive, and you can revoke it at any time. A few traps catch people off guard, and they’re worth knowing before you record anything.
How to Create and Record One
A valid TODD needs a legal description of the property, your name as the current owner (the “transferor”), at least one named beneficiary, and a clear statement that the transfer happens at your death. Montana provides an optional statutory form at Section 72-6-415 that satisfies all of these requirements and avoids most drafting mistakes.1Montana State Legislature. Montana Code 72-6-415 – Optional Form of Transfer on Death Deed
You must sign the deed in front of a notary. After notarization, record it with the county clerk and recorder in the county where the property sits. A TODD that is never recorded has no legal effect and will not transfer the property at death.2Montana State Legislature. Montana Code 72-6-404 – Transfer on Death Deed Authorized
The clerk will also require a completed Realty Transfer Certificate from the Montana Department of Revenue before accepting the deed. The certificate declares the consideration (none, in the case of a TODD) and updates water-right ownership records.3Montana State Legislature. Montana Code 15-7-305 – Realty Transfer Certificate Required
While you’re alive, the TODD changes nothing. You can still sell, mortgage, or otherwise use the property. The beneficiary gets no legal interest until you die.4Montana State Legislature. Montana Code 72-6-411 – Effect of Transfer on Death Deed During Transferors Life
Revoking or Changing a TODD
You can undo or change a TODD at any time before death, and the beneficiary’s consent is not required. Montana law provides three ways to revoke:
- Record a new TODD for the same property. The new deed replaces the old one.
- Record a separate revocation instrument whose only purpose is to cancel the earlier TODD.
- Transfer the property to someone else during your lifetime. Once you no longer own it, the TODD is meaningless.
Whichever method you use, the revocation must be recorded with the same county clerk and recorder where the original TODD was filed. An unrecorded revocation has no effect, and the original TODD still governs at death.5Montana State Legislature. Montana Code 72-6-410 – Revocation by Instrument Authorized
One common mistake: writing in your will “I revoke my transfer on death deed.” That does not work. A TODD operates outside the will-and-probate system entirely, and you cannot revoke it through a will or a codicil. You also cannot revoke it by crossing out text on the recorded deed.6Montana State Legislature. Montana Code 72-6-406 – Transfer on Death Deed Nontestamentary
Joint Ownership Usually Wins
When property is held in joint tenancy with right of survivorship, the joint tenancy generally takes priority over a TODD. If only one joint owner signs and records a TODD, that deed is effective only if the signing owner turns out to be the last surviving joint tenant. If the signing owner dies first, the surviving joint tenant takes the property through survivorship and the TODD does nothing.
If all joint owners sign and record the same TODD, the deed works as expected when the last surviving owner dies. That last survivor can also revoke the existing TODD or record a new one naming different beneficiaries. To revoke a TODD on jointly owned property before that point, every living owner who signed the original must sign the revocation. One co-owner alone cannot cancel the other’s portion.
Beneficiaries and Alternates
You can name one or more primary beneficiaries and one or more alternates in the same TODD. An alternate takes the property only if the primary beneficiary dies before you. Planning matters here, because if you name only one beneficiary and that person predeceases you, the TODD is a dead letter. The property passes through your will, or if you have none, through Montana’s intestate succession rules.
Unless your TODD says otherwise, a beneficiary must survive you to receive the property. If two people die close together, Montana’s general survival rule requires clear and convincing evidence that the beneficiary outlived the owner by at least 120 hours. You can override that default by including specific language in the deed.7Montana State Legislature. Montana Code 72-2-712 – Requirement of Survival by 120 Hours
You can also include anti-lapse language so that a deceased beneficiary’s share passes to that person’s descendants by right of representation rather than lapsing.
What the Beneficiary Does After You Die
A TODD avoids probate but not paperwork. The beneficiary should obtain a certified copy of your death certificate and file an Affidavit of Death with the county clerk and recorder where the property is located. Montana Courts publishes a standard form. The affidavit identifies the deceased owner, references the recorded TODD, and attests to the beneficiary’s entitlement.8Montana Courts. Affidavit of Death The beneficiary will also complete a Realty Transfer Certificate when recording it.3Montana State Legislature. Montana Code 15-7-305 – Realty Transfer Certificate Required
The One-Year Title Insurance Problem
Creditors of the deceased owner have up to one year after death to bring claims against property that passed by TODD. Because of that window, title insurance companies will generally refuse to insure a sale from a TODD beneficiary to a buyer unless one of two conditions is met. Either a probate has been opened, creditor notice has been published for three consecutive weeks, and four months have passed since the first publication, or a full year has passed since the owner’s death.
If you inherit through a TODD and want to sell quickly, you have limited options: open a probate solely to run the creditor notice period (roughly four to five months total), wait out the full year, or sell and hold the proceeds in escrow for the remainder of the year. This is the practical limitation most beneficiaries do not hear about until they’re already trying to close a sale.
What a TODD Does Not Protect Against
The Deceased Owner’s Debts
A TODD does not shield the property from the deceased owner’s creditors. A beneficiary who receives property through a TODD is liable for allowed claims against the probate estate and for statutory allowances owed to a surviving spouse and children, to the extent the probate estate itself cannot cover those obligations.9FindLaw. Montana Code 72-6-112 – Nonprobate Transferees Liability
The beneficiary’s exposure is capped at the value of the property received. If you inherit a home worth $300,000 and the probate estate cannot cover $50,000 in the owner’s debts, you could be liable for up to $50,000. Existing liens and mortgages also travel with the property. The statutory form itself says the transfer is “subject to any liens or mortgages (or other encumbrances) on the property at your death.”1Montana State Legislature. Montana Code 72-6-415 – Optional Form of Transfer on Death Deed
A Surviving Spouse’s Elective Share
Montana protects surviving spouses through an elective share that applies to the “augmented estate,” which includes both probate and nonprobate assets. Property transferred by TODD still counts. If a TODD names someone other than the surviving spouse, the spouse can claim their elective share and potentially override the TODD’s terms. The calculation considers the length of the marriage, the value of what the surviving spouse already received, and the total augmented estate. A TODD works best when coordinated with a broader estate plan rather than treated as a standalone fix.
Medicaid Estate Recovery
Montana’s Medicaid program can pursue recovery of benefits paid on behalf of a deceased recipient from property transferred by TODD. The state’s recovery statute defines recoverable property as any real or personal property in which the recipient had an interest immediately before death, including assets passing through “joint tenancy, tenancy in common, right of survivorship, conveyance by the recipient subject to life estate, living trust, or other arrangement.” A TODD falls squarely within that language.10Montana State Legislature. Montana Code 53-6-167 – Recovery of Medicaid Benefits After Recipients Death
A beneficiary can request a hardship waiver. The Department of Public Health and Human Services will waive recovery in whole or in part if enforcing the claim would cause undue hardship, for example where the property is part of a working farm or ranch the beneficiary depends on for a livelihood and has no other way to satisfy the claim.11Cornell Law School. Mont Admin r 37.82.431 – Medicaid Estate Recoveries, Waiver of Recovery Based Upon Undue Hardship If Medicaid is a factor in your situation, have an elder law attorney review the TODD before you record it.
Taxes
Montana does not impose an estate or inheritance tax. The state eliminated its estate tax for deaths after 2004 and has never had a standalone inheritance tax. A beneficiary receiving property through a TODD owes nothing to the state based solely on the transfer.12Montana Department of Revenue. Montana Estate and Inheritance Tax
Because the property transfers at death rather than as a lifetime gift, the beneficiary takes it with a stepped-up basis equal to the fair market value on the date of death. That matters at sale. If you bought the home for $100,000 and it was worth $400,000 when you died, the beneficiary’s basis is $400,000, and a sale near that price produces little or no capital gains tax. A lifetime gift would have carried over your original $100,000 basis and produced a much larger tax bill on sale.
What It Costs
Setting up a TODD is inexpensive. Montana county clerks charge $20 for recording the first page and $10 for each additional page. A standard TODD runs one to two pages, so recording fees fall between $20 and $30. The same fees apply to a revocation or an affidavit of death.
Notary fees are modest, generally a few dollars per signature. If you hire an estate planning attorney to draft the deed rather than using the statutory form on your own, attorney fees in Montana for a straightforward document typically run $100 to $300, with complex situations costing more. The TODD itself triggers no transfer taxes, because no sale occurs at recording and the transfer does not take effect until death.