Transfer on Death for Vehicles in California

Last edited 123 days ago by Ted Broomfield

Summary: This blog is for readers who are considering estate planning, who understand the concept of transfer on death and who want to learn about the details of making vehicles that they own subject to transfer on death and outside of the California Probate process. The concepts are simple, under Vehicle Code sections

4150.7⁠

and

5910.5⁠

for vehicles and

9852.7⁠

and

9916.5⁠

for vessels.

DETAILS

Completing the initial transfer on death Certificate of Title

Basically, where there is one vehicle owner, and one named beneficiary, the vehicle owner can title the vehicle to one named beneficiary by submitting a new California Certificate of Title and entering the beneficiary’s name after the letters “TOD” on line two, the vehicle owner signing the Certificate and paying the fee.

Note, TOD for vehicles can only be effected where there is one registered owner and one beneficiary, only.

The beneficiary does not need to sign anywhere on the form. The registered owner does not need to sign line 1 of the form, but must sign on the signature line.

Transfer on death does not impair ability to sell and can be changed or revoked

The presence of a Transfer on Death Beneficiary, or TOD, does not impair the owner’s ability to sell the vehicle. The beneficiary does not own the vehicle and cannot obtain a loan on the vehicle. The beneficiary’s signature is not required to sell the vehicle.

Sale of the vehicle by the owner [Testator] voids the transfer on death election. Alternatively, if the owner [Testator] wants to void the transfer on death, the owner can simply file a new Certificate of Title, and not name a TOD beneficiary or name a different TOD beneficiary.

Beneficiary’s steps to obtain title after death

After the original owner passes away and the beneficiary wants to obtain title, the process as straightforward as any DMV process can be.

The beneficiary signs his or her name as the registered owner on line one and submits a completed California

DMV Form Reg 256⁠

. The beneficiary selects “Inheritance,” in Box A, and types the pertinent facts in Box G. The pertinent facts are the previous, now deceased, owner’s name & address, the previous, now deceased, owner had named the beneficiary of the vehicle on the transfer on death Certificate of Title on the date that it occurred, and the previous, now deceased, owner passed away on a specific date.

CONCLUSION

Transfer on death of a vehicle is a relatively easy way to avoid the more complex, time-consuming and costly probate process. Transfer on death of a vehicle can frequently be preferable to transfer via a Trust, because the Trust requires drafting, updating and administration, as well as distribution.

So, comparatively, transfer on death of a vehicle is relatively quick, easy and straightforward helping to avoid unnecessary costs.

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