SB 651 adds a new Maryland Transfer‑on‑Death Deed Act to the Real Property Article and makes related changes across Estates & Trusts, Real Property, and Tax‑Property laws. The bill authorizes a deed that a property owner can execute, acknowledge, and record to name one or more designated beneficiaries who will receive the owner’s real property at the owner’s death without probate.
The statute supplies a model form for both creating and revoking a transfer‑on‑death deed and sets out recording, revocation, survivorship, and title consequences.
The measure also adjusts clerk and assessor procedures (including limited intake‑sheet and endorsement exceptions for these deeds), requires certain disclaimers of real‑property beneficiary interests to be recorded, exempts primary and secondary residences transferred by transfer‑on‑death deed from recordation and county transfer taxes, and states that the law applies to deeds made before or after the effective date where the transferor dies on or after that date. For lawyers, title professionals, county recording offices, and estate planners, the bill creates a standardized nonprobate path for passing real property while raising implementation and creditor‑protection questions worth immediate attention.
At a Glance
What It Does
Creates a statutory, revocable transfer‑on‑death deed (TOD deed) that is effective only if recorded in the county land records before the transferor’s death; supplies a model form for creation and revocation; and provides rules about survivorship, title at death, and revocation.
Who It Affects
Residential property owners who want to avoid probate, beneficiaries named on TOD deeds, county clerks and assessment offices (recording and intake processes change), title companies, estate attorneys, and county treasuries (due to tax exemptions).
Why It Matters
The bill gives homeowners a simple, standardized nonprobate conveyance for real estate but shifts administrative work to recording and assessment offices, alters tax exposure for counties, and tightens the timing and formality needed to create or revoke these interests.
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What This Bill Actually Does
SB 651 establishes a Maryland Transfer‑on‑Death Deed Act that lets an owner of real property name one or more designated beneficiaries to receive that property at the owner’s death without probate. The deed must be executed, acknowledged, and recorded in the land records of each county where the property lies before the owner dies; recording is the trigger that makes the instrument effective under the new subtitle.
The statute treats the instrument as non‑testamentary and expressly preserves the transferor’s full ownership rights during life — the beneficiary acquires no legal or equitable interest until the transferor’s death.
The bill spells out practical consequences and limits. A recorded TOD deed does not defeat the transferor’s ability to encumber or convey the property while alive; it does not protect the property from the transferor’s creditors and does not affect public‑benefit eligibility.
At death the beneficiary (or an alternate beneficiary if the primary does not survive) receives the property subject to any mortgages, liens, or other encumbrances that existed on the property at the time of death; the deed transfers title without covenant or warranty.Revocation must be done by recording in the land records an executed and acknowledged instrument that expressly revokes the original TOD deed, a new TOD deed inconsistent with the earlier deed, or an inter vivos deed that expressly revokes it. Once the deed is recorded, it cannot be revoked by a revocatory act on the recorded document itself or by a will.
If multiple transferors signed a joint TOD deed, revocation requires all living joint owners to act; revoking by one owner does not affect the interests of the others.The act also provides administrative details: it adds definitions and cross‑references in Estates & Trusts (including requiring recorded disclaimers for real property beneficiary interests), exempts certain recording intake and endorsement requirements for TOD deeds, requires supervisors of assessments to refrain from transferring ownership on assessment rolls until the transferor’s death (absent a subsequent recorded revocation), supplies official form language and an informational sheet for consumers, and carves out limits on applying federal E‑SIGN rules to these deeds. Finally, the bill exempts transfers of a transferor’s primary or secondary residence by TOD deed from the State recordation tax and from county transfer tax, and it applies retroactively to TOD deeds executed before the act where the transferor dies on or after the effective date (Oct. 1, 2026).
The Five Things You Need to Know
A transfer‑on‑death deed is effective only if executed, acknowledged, and recorded in the county land records before the transferor dies.
Recording the TOD deed does not give the beneficiary any property interest during the transferor’s life and does not shield the property from the transferor’s creditors.
A recorded TOD deed can be revoked only by recording an executed and acknowledged revocation instrument, a later inconsistent TOD deed, or an inter vivos deed that expressly revokes it; a will cannot revoke a recorded TOD deed.
If a TOD deed names multiple beneficiaries and does not specify ownership form, the statute makes their concurrent interests pass as joint tenants with rights of survivorship.
Transfers by TOD deed of a transferor’s primary or secondary residence are exempt from the State recordation tax and from county transfer tax under the bill’s Tax‑Property provisions.
Section-by-Section Breakdown
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Recognizes TOD deeds as nonprobate transfers and integrates disclaimer rules
The bill adds a new §1‑402 to place transfer‑on‑death deeds under 'Nontestamentary Transfers' and modifies the Maryland Uniform Disclaimer of Property Interests Act to cover disclaimers of nonprobate transfers. Practically, that means a beneficiary who refuses (disclaims) a real‑property interest created by a TOD deed must record the disclaimer in the land records and follow the existing statutory rules for disclaimers — the recorded disclaimer becomes part of the title history and is necessary to effect the disclaimer against real property.
Limits intake and endorsement requirements for TOD deeds; assessment postponement
The clerk of the circuit court may record change‑of‑ownership instruments without the usual collector endorsement or assessment intake sheet when the instrument is a transfer‑on‑death deed or its revocation executed under the new subtitle. At the same time, the Supervisor of Assessments will not move the property onto another owner’s assessment record on the basis of the recorded TOD deed — ownership is transferred in assessment records only after the transferor’s death (and unless a revocation was recorded after the TOD deed). The practical effect is to allow recording while preventing premature assessment transfers; clerks and assessment offices must update procedures to track recorded TOD deeds separately from immediately effective conveyances.
Core Transfer‑on‑Death Deed regime: definitions, creation, effect, and limitations
The new subtitle defines terms (transferor, beneficiary, designated beneficiary, joint owner, property) and establishes that an owner may transfer property at death by a TOD deed. The statute requires the capacity to sign a TOD deed to be the same as that required to make a will, provides that the deed must state the transfer occurs at death, and makes recording before death the condition of effectiveness. The subtitle also clarifies what a TOD deed does not do during the owner’s life: it does not change the owner’s rights, create a beneficiary interest, protect versus the owner’s creditors, or affect eligibility for public assistance.
How title vests at death and what the beneficiary receives
On death, the interest passes to any surviving designated beneficiary (or alternate successor designated in the deed) and lapses if the beneficiary does not survive. Concurrent beneficiaries take as joint tenants with rights of survivorship unless the deed specifies otherwise. The beneficiary takes subject to any conveyances, mortgages, liens, or other encumbrances that burden the property at the transferor’s death; the statute deems delivery to have occurred at death and disclaims covenant and warranty of title. The subtitle also reconciles TOD deeds with statutes governing pretermitted children, elective shares, divorce revocations, lapse, intentional homicide disqualification, and simultaneous death rules.
Revocation must be recorded; model forms and consumer materials provided
The bill requires revocation of a recorded TOD deed to be performed by recording an executed, acknowledged instrument that expressly revokes the deed (or by recording a new inconsistent TOD deed or inter vivos deed that expressly revokes it). The statute prohibits revocation by a revocatory act on the recorded deed itself or by a will. The text supplies a model TOD deed and a model revocation form plus explanatory consumer sheets and instructs clerks to accept properly acknowledged and recorded forms; those forms set basic consumer warnings but do not force legal counsel.
Disclaimers must follow Maryland law; E‑Sign carve‑outs
Beneficiaries may disclaim interests under the Maryland Uniform Disclaimer Act; the bill requires recording of disclaimers for real‑property beneficiary interests. The subtitle also limits application of the federal E‑SIGN Act: it modifies, limits, and supersedes E‑SIGN for this subject matter but does not alter certain federal E‑SIGN provisions (including Section 101(c)) or authorize electronic delivery of specified notices. In short, the statute preserves traditional notarial/acknowledgment and recording expectations for these deeds.
Recordation/transfer tax carve‑outs for residences passed by TOD deed
The bill adds a narrow tax benefit: a transfer of real property by TOD deed is not subject to the State recordation tax if the property is the transferor’s primary or secondary residence, and it explicitly links transfer‑tax exclusions to that recordation exemption so that such instruments are not subject to county transfer tax. The statutory cross‑references ensure transfer tax treatment tracks the new recordation exclusion.
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Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Individual property owners who want a simple, revocable way to pass real property without probate — they can name beneficiaries, retain full control during life, and avoid probate delays and costs.
- Designated beneficiaries and heirs — they may receive faster title after the owner’s death because the statute vests title at death without opening probate, subject to existing encumbrances.
- Estate planners and some title professionals — the model forms create a standardized drafting path and a new client service line to implement nonprobate transfers for residential clients.
Who Bears the Cost
- County clerks and land‑records offices — they must adopt new intake/recording policies, accept and track standardized TOD deeds and revocations across counties, and handle potential increases in filings and post‑death title processing.
- County treasuries and local governments — the recordation and county transfer tax exemptions for primary and secondary residences reduce fee and tax revenues tied to residential transfers by TOD deed.
- Creditors and claimants pursuing claims against a decedent — although creditors’ rights against the decedent generally survive, the nonprobate transfer can complicate timing for asserting liens or initiating collection steps before title passes at death, increasing litigation or collection costs.
Key Issues
The Core Tension
The central dilemma is between simplifying property transfers for living owners — giving them a low‑cost, revocable way to avoid probate — and protecting third‑party and public interests (creditors, surviving spouses, pretermitted heirs, and local revenue streams). A rule that makes transfers easy and private increases the risk of unnoticed liens, tax revenue erosion, and post‑death contests; a rule that preserves every protection would undercut the simplicity that drives homeowners to use a TOD deed in the first place.
SB 651 trades a straightforward, standardized way to pass real property for a set of practical trade‑offs and open questions. First, because recording before death is necessary to make the deed effective, the bills shift the risk of defective or missing recording to owners and clerks: an unrecorded deed does nothing, while clerks will need rules to identify and process the statutory forms, including handling multi‑county properties.
Second, the statute leaves significant creditor and lien issues intact — beneficiaries take subject to encumbrances — but the nonprobate transfer can shorten the window for creditors to assert post‑death claims, potentially increasing litigation over priorities and surplus proceeds.
Third, the retroactivity provision (applying the Act to TOD deeds made before the effective date if the transferor dies on or after the effective date) surfaces uncertainty where earlier life‑estate‑with‑powers documents or home‑made instruments exist: courts will be asked to reconcile prior instruments with the new statutory regime and the bill’s direction to interpret consistently with life‑estate law and the Uniform Real Property Transfer on Death Act. Fourth, the E‑SIGN carve‑out preserves in‑person acknowledgement and recording expectations, but that raises questions about electronic filing and remote notarization workflows that registrars and title companies have been developing.
Finally, the tax exemptions for residences create a narrow relief that may incentivize use for primary homes but could prompt local revenue shortfalls and pressure for tighter statutory or administrative limits.
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