Probate & Trust Law Section Conference Manual ... - Minnesota CLE

emains private both during the owner’s lifetime and after death. For some
owner’s the ability to keep dispositive provisions private is an important aspect of
using a revocable trust.
The biggest disadvantage of using a revocable trust is the cost. In addition, assets
must be transferred to the trust during the owner’s lifetime to avoid probate. If
the owner fails to transfer the assets into the trust before death, those assets will
have to go through probate anyway.
C. PROBATE
The potential cost and delays and public nature of the process are the primary
disadvantage of transferring property through probate. However, in the opinion
of these authors probate in Minnesota is a relatively inexpensive process with
limited supervision and in many situations is preferable to non-probate
alternatives. Nonetheless, probate avoidance is often an appropriate goal,
particularly in a simple estate.
IV.
COMMON QUESTIONS ABOUT TRANSFER ON DEATH DEEDS
A. RECORDING REQUIREMENTS
Does a TODD have to be recorded in every county where the real property
is located to be effective?
To be effective, a TODD must be recorded in at least one county where
the described real property is located before the death of the first Grantor
Owner to die. The recording requirement helps alleviate concerns about
fraud and undue influence or the possibility of the unrecorded deed
“hidden in grandpa’s dresser drawer”. In other words, the requirement of
recording helps insure that the owner thoughtfully intended to make the
transfer.
Authority: Minn. Stat. § 507.071, Subd. 8.
B. STATE DEED TAX
How is deed tax calculated and paid?
Because a TODD has no effect at the time it is recorded and has no effect
until the Grantor Owners die at a later date, a TODD is exempt from state
deed tax. Because a TODD is exempt from deed tax, the word “Exempt”
should be inserted in the space for deed tax on a TODD, rather than
“None.” There is no need to recite that “The consideration for this transfer
is $500 or less.”
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