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Pros/cons of beneficiary deed vs putting house in living trust

Bogleheads • View forum - Personal Finance (Not Investing) - www.bogleheads.org
Beneficiary deeds (ToD deed) for your primary residence aren't available in all states (~20 states allow it), but in states where it's available, what are the pros and cons of using that versus putting the house in a living revocable trust? (the house in question is owned by an individual, not joint)

The beneficiary deed seems like a simpler and cheaper process for a simple estate (and one that will be well below estate tax considerations). The only downsides I can find are

(1) it can impact Medicaid eligibility while the homeowner is alive (but you can get around that by cancelling the deed at a later date if Medicaid is needed), and

(2) there is a wait time of a couple/few months after the death before transferring ownership to the beneficiaries (I guess the title company is involved in this wait time determination?), so you can't sell the house quickly (not a big issue in this case since there would be at least a couple months of sorting/donating/selling the contents of the house before it could be sold anyway).

Are there other downsides to a ToD deed? Does putting the house in a living trust have any advantages over a ToD deed (excluding the two I mentioned above)?
Date: Nov 12, 2015   


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