For many Maryland homeowners, deciding how a home will pass to the next generation is an important part of their estate plan. While financial accounts have long allowed owners to name beneficiaries, real estate has traditionally required other planning strategies to avoid probate.

Beginning October 1, 2026, Maryland will authorize the Transfer-on-Death (TOD) deed, giving homeowners a new way to transfer real estate directly to beneficiaries upon death without the property passing through probate. This can simplify estate administration, reduce costs, and shorten the time it takes for beneficiaries to receive ownership of the home.

What is a Transfer-on-Death Deed?

A Transfer-on-Death (TOD) deed is a legal document that allows a homeowner to designate a beneficiary to receive their real estate upon their death. Similar to naming a beneficiary on a financial account, a TOD deed can allow the property to avoid probate. The deed must be signed, notarized, and recorded prior to the owner’s passing to be effective in Maryland.

The TOD deed can be changed or canceled at any time while you are alive, and you retain full ownership of the property until your passing. Please note that any existing loans on the property will be passed on to the beneficiary of the TOD deed.

TOD deeds are authorized by Maryland effective October 1^st, 2026. Any deeds created before this date will only be considered legally valid if the owner passes on or after October 1^st, 2026.

How Does it Compare to Other Estate Planning Options?

Prior to the creation of the Transfer-On-Death deed, homeowners commonly relied on life estate deeds and revocable living trusts to avoid probate.

A life estate deed is an arrangement in which two or more people have ownership rights in a property that are split over time. The “life tenant” owns, uses, and maintains financial responsibility of the property during their lifetime. The “remainderman” holds future interest in the property, but does not have the right to use or transfer the property without the life tenant’s consent. Once the life tenant passes, the remainderman automatically becomes the owner of the property. While effective, life estate deeds can be difficult to change once created.

A living trust, otherwise known as a revocable trust, is a trust established by the grantor during their lifetime that can be changed or revoked at any time. While there are many reasons to establish a living trust, one of its primary advantages is that any assets owned by the trust, including real estate, bypass probate and are distributed according to the trust provisions. While living trusts can provide additional estate planning benefits, they can be costly to create.

Is a Transfer-on-Death Deed Right for You?

For many homeowners, a Maryland Transfer-on-Death deed offers a simple way to avoid probate while allowing the owner to maintain complete control of the property. However, families with more complex estate planning needs may benefit from other planning strategies.

Before implementing a TOD deed, consult with an estate planning attorney and your financial advisor to determine whether it fits within your overall estate plan and aligns with your family’s long-term goals.

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