Illinois Transfer on Death Instrument (TODI)

An Illinois transfer on death instrument, or TODI, lets you name who receives your real estate when you die, without sending the property through probate. You sign it, have two witnesses attest to it, get the signatures notarized, and record it with the county recorder of deeds while you are alive. You hold full ownership and control of the property for the rest of your life. Title passes to the person you named only at your death. Illinois authorizes this in the Real Property Transfer on Death Instrument Act, 755 ILCS 27/.

People search for this document as an "Illinois beneficiary deed" or an "Illinois TOD deed." The statute calls it a transfer on death instrument, and that is the term that controls. A TODI is a statutory death-transfer document, not a Lady Bird deed or an enhanced life estate deed that some other states rely on.

Anyone reading older articles should check the date. The Act reached only residential real estate when it started, and 755 ILCS 27/10 still frames coverage around the owner's date of death: residential real estate for an owner dying on or after January 1, 2012, and all real property for an owner dying on or after January 1, 2022, the effective date of Public Act 102-68. The owner's death date sets the rule, not the date the document was signed.

This guide sits alongside the Illinois guide to avoiding probate and the Illinois probate process guide. For the local court path after a death, start at the Illinois probate hub.

What an Illinois TODI Does

A transfer on death instrument names the person, people, or trust that will receive your real property at your death. While you are alive, the instrument does nothing to your ownership. You still hold title, and you can sell, mortgage, gift, or re-deed the property whenever you want. When you die, title passes to the beneficiary you named, outside probate.

755 ILCS 27/20 authorizes the instrument and lets an owner transfer real property to one or more beneficiaries in any form of ownership valid under state law. 755 ILCS 27/30 makes it nontestamentary, which means it works on its own and does not run through your will.

Two details save people trouble. Under 755 ILCS 27/21, you may name the trustee of a trust as the beneficiary, including a trust you can still amend or revoke, and the property then follows the terms of that trust. Under 755 ILCS 27/50, the instrument works without notice to the beneficiary, without delivery, without the beneficiary accepting it, and without consideration. You do not have to tell the beneficiary, and many owners never do.

One limit hides in the definitions. 755 ILCS 27/5 defines an "owner" as an individual who owns an interest in real property, and it excludes a trustee or an individual acting in a fiduciary, representative, or agency capacity. Property already titled in a trust does not pass by a TODI.

You Keep Full Control While You Are Alive

Recording a TODI hands nothing to the beneficiary while you are living. 755 ILCS 27/60 spells this out. During your life the instrument does not affect your right, or an agent's right, to sell, transfer, or encumber the property. It does not create a legal or equitable interest for the beneficiary. It does not expose the property to claims of the beneficiary's creditors. It does not change your eligibility, or the beneficiary's eligibility, for public assistance.

The instrument stays revocable no matter what it says. 755 ILCS 27/25 makes a TODI revocable even when the instrument, or another document, contains a contrary provision. You cannot lock yourself in.

Two capacity rules are worth marking. Under 755 ILCS 27/35, the capacity to make or revoke a TODI is the same as the capacity to make a will. That same section closes a gap people miss: an agent under a durable power of attorney, even one the document says is fully authorized, cannot create or revoke a TODI for the owner. The section adds that the agent may still sell, transfer, or encumber the real property under the terms of the agency. So an agent can sell the house but cannot decide who inherits it. If you want a TODI, sign it while you have capacity. Compare how agent authority works in the Illinois power of attorney guide.

How to Sign and Record an Illinois TODI

An Illinois TODI carries a signing standard closer to a will than to an ordinary deed. 755 ILCS 27/45 requires the instrument to be signed by the owner, or by another person in the owner's presence and at the owner's direction, and attested in writing by two or more credible witnesses. The witnesses attest that the owner signed in their presence, that the signing was the owner's free and voluntary act, and that the owner appeared to be of sound mind and memory. The witnesses' signatures and the owner's signature are then acknowledged in front of a notary public. Fall short of two credible witnesses and the instrument is void.

Watch who you ask to witness. Under Section 45(c), if a beneficiary or a beneficiary's spouse attests to the signing, the interest passing to that beneficiary is void unless enough other qualified witnesses signed. Use two neutral witnesses who take nothing under the document.

755 ILCS 27/40 sets the recording rule. The instrument must contain the elements and formalities of a properly recordable inter vivos deed, though it does not need to state consideration or the beneficiaries' addresses. It must state that the transfer to the beneficiary occurs at the owner's death. It must be recorded before the owner's death with the recorder of the county or counties where any part of the property sits. Section 40(b) is blunt about the stakes: failing any of those requirements renders the instrument void and ineffective to transfer title. An instrument you sign but never record does nothing. One recorded the day before death still works. One recorded after death does not work at all.

Here is the path:

1. Pull your current recorded deed and copy the exact legal description. Use that description, not just the street address.
2. Decide who takes the property, and read the lapse rules below before you assume a backup is automatic.
3. State in the instrument that the transfer takes effect at your death.
4. Sign in front of two credible witnesses who are not beneficiaries or the spouse of a beneficiary.
5. Have all signatures acknowledged by a notary public.
6. Record the signed instrument with the recorder of deeds in every county where the property sits, before death.
7. Keep a copy with your estate papers.

Illinois also says who should draft the document. 755 ILCS 27/95 provides that a TODI or its revocation shall be prepared only by a licensed attorney. The same section says nothing in it prohibits an owner from preparing his or her own instrument or revocation, and that a self-prepared instrument is not void for that reason. Read those two sentences together: the statute directs you to an attorney, and it declines to punish the beneficiary if you did it yourself. Because a small error voids the transfer under Section 40(b), most owners have an Illinois attorney draft or review the instrument before recording it.

How to Revoke or Change a TODI

A TODI stays revocable for as long as you live. 755 ILCS 27/55 sets the only method that counts. An instrument revokes a recorded TODI only if it is either a later TODI that revokes the earlier one expressly or by inconsistency, or a separate instrument of revocation that expressly revokes it. Either one must be executed, witnessed, and acknowledged the same way Section 45 requires, dated after the acknowledgment of the instrument being revoked, and recorded before your death in the county or counties where the earlier TODI is recorded.

Section 55(b) closes the shortcuts. A recorded TODI may not be revoked by a revocatory act on the document, by an unrecorded instrument, or by a provision in a will. Tearing up your copy revokes nothing. Writing "revoked" across it revokes nothing. New will language revokes nothing. If your plans change, record the change.

Selling the property is not a revocation either, and the difference matters. 755 ILCS 27/60 says that if you contract to sell the property after recording a TODI and the contract is still executory when you die, the contract does not revoke the instrument. The property passes to the beneficiary subject to that contract. A completed sale leaves nothing for the instrument to transfer, since 755 ILCS 27/65 applies to real property the owner still owned at death. A half-finished sale is the case that surprises families, so record a revocation rather than relying on a pending closing.

Who Takes the Property at Your Death

755 ILCS 27/65 sets default rules that many owners assume run the other way. Check them against what you actually want.

• Name two or more beneficiaries to take at the same time and they take equal, undivided shares with no right of survivorship. Illinois does not add survivorship for you.
• Name one beneficiary who dies before you, and the property passes to your estate, which sends it into probate. That is the outcome a TODI was meant to skip.
• Name several beneficiaries and lose one of them, and that share moves to the remaining beneficiaries in proportion to their interests.
• Name a beneficiary who is your descendant and who dies before you, and that share goes to the deceased beneficiary's living descendants per stirpes.
• If the order of deaths cannot be established, the beneficiary is treated as having died first.

The property also comes with strings. Section 65(b) says the beneficiary takes it subject to all conveyances, encumbrances, assignments, contracts, options, mortgages, liens, and other interests in place at your death. Section 65(c) adds that a TODI transfers the property without covenant or warranty of title even if the instrument says otherwise. A beneficiary who wants out can disclaim the interest under 755 ILCS 27/80.

Joint Owners and a Spouse's Right to Renounce

755 ILCS 27/70 handles co-owned property. A TODI does not sever a joint tenancy or a tenancy by the entirety. If all joint owners sign, the instrument may be revoked only by all of the then living joint owners, and the last surviving joint owner may always revoke it. If fewer than all the joint owners sign, the designation of the joint owner who dies last governs, and if that person signed nothing, an earlier owner's designation does no work at all.

A surviving spouse has a separate right. Under 755 ILCS 27/66, unless the spouse waived the right, the spouse may renounce a TODI and take a one-third interest in the transferred property if the owner left a descendant, or a one-half interest if the owner left none. To do it, the spouse files a signed written instrument describing the property and declaring the renunciation with the recorder where the TODI is recorded, within seven months after the death, subject to any extension a court grants under Section 2-8 of the Probate Act of 1975. A spouse may waive that right in the instrument itself. Anyone planning around a blended family should read this section before recording.

What a TODI Does Not Do

A TODI moves the property. It does not erase what the property owes or shield it from every claim.

The beneficiary takes the property with its debts attached. A mortgage, home equity loan, property tax lien, or judgment lien stays with the real estate. Your beneficiary receives the property and the loan, not clear title.

Estate creditors can reach the property, but only after the probate estate runs out. Under 755 ILCS 27/85, a TODI beneficiary is subject to creditor, administrative, funeral and burial, and statutory claims to the same extent as a beneficiary of a trust that was revocable at the settlor's death under Section 505 of the Illinois Trust Code. Section 505(a)(5) attaches that liability only to the extent the probate estate is inadequate to pay those claims, and a claim already barred against the estate is barred against the trust property too. When more than one property passes by TODI, that liability is apportioned among the properties in proportion to their net values at death. The Illinois creditor claims guide explains how those claims move through an estate.

Medicaid estate recovery can follow the property. If the person who died received long-term-care benefits, the State can pursue repayment, and a TODI does not by itself put the property beyond that reach. Anyone who has received, or may need, long-term-care Medicaid should talk with an elder law attorney before recording one.

It moves only the property described in it. Bank accounts, vehicles, and personal property need their own payable-on-death or transfer-on-death designations, or they pass through probate. If no plan covers them, the Illinois intestate succession rules decide who takes.

The step-up in basis still applies. Because the property passes at your death, your beneficiary takes it with a cost basis reset to its date-of-death value under Internal Revenue Code Section 1014. That reset can erase most or all of the capital gains tax if the beneficiary sells soon after inheriting. The Illinois guide to selling inherited property covers what a beneficiary faces when selling property received by a TODI.

After the Owner Dies

Once the owner dies, the beneficiary confirms the record by filing a notice of death affidavit. Under 755 ILCS 27/75, any beneficiary who takes under a TODI may file the affidavit with the recorder in the county where the property sits. It states the name and address of each beneficiary, the legal description, the street address and parcel number, the date of the TODI and its recording number, the owner's name, the date and place of death, and where future tax bills should go. It must be acknowledged under penalty of perjury before a notary. Filing it is not a condition of the transfer, since title already passed at death, but recording it clears the chain for a later sale or refinance.

A TODI is not beyond challenge. 755 ILCS 27/90 requires an action to set aside or contest a TODI to begin within the earlier of two years after the owner's death or six months from the date letters of office issue under the Probate Act of 1975. The same section protects a bona fide purchaser or mortgagee for value who buys or lends before a lis pendens is recorded under Section 2-1901 of the Code of Civil Procedure or before a notice of renunciation is filed under Section 66. Because opening an estate can close the contest window fast, a beneficiary who expects a dispute should move early. The Illinois probate timeline shows when letters of office typically issue.

When a TODI Fits

A TODI tends to work well when:

• you own real estate in your sole name and want one person or a couple to receive it,
• you want to skip probate on the property without setting up a trust,
• you want to hold full control and the freedom to change your mind, and
• the title is clean and your plan is straightforward.

Look harder at other tools when:

• the property already has co-owners with survivorship rights that may handle it,
• several people should share the property in shifting amounts,
• Medicaid, creditor, blended-family, or tax questions are in play,
• the property is headed into a living trust, or
• you want one document to cover real estate, accounts, and personal property together.

When those apply, compare the paths in the Illinois guide to avoiding probate.

The Bottom Line

An Illinois transfer on death instrument is a low-cost way to pass real estate outside probate while you keep full control during life. It runs on 755 ILCS 27/, it reaches all real property for owners dying on or after January 1, 2022, and it records with the county recorder of deeds. It carries a will-style signing standard: your signature, two credible witnesses who take nothing under it, and a notary. Revoke it only by recording a later instrument, never by tearing up a copy or rewriting your will.

Check the default rules before you sign. A sole beneficiary who dies before you sends the property to your estate and into the probate you were trying to skip. Two beneficiaries take equal shares with no survivorship. A surviving spouse can renounce and claim a third or a half. None of that is obvious from the document itself. When Medicaid, co-owners, a blended family, or a mortgage are in the picture, have an Illinois attorney review the instrument before you record it. A small drafting error voids the transfer at your death, and fixing it afterward costs far more than getting it right now.

This guide is general information about Illinois transfer on death instruments, not advice for your situation. Confirm the current statute and your local recording steps with the county recorder of deeds, and have a licensed Illinois attorney review the instrument before you sign or record it.

Sources:

• Title: 755 ILCS 27/, Real Property Transfer on Death Instrument Act. Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Not listed. URL: https://www.ilga.gov/Legislation/ILCS/details?ActID=3382&ChapterID=60&SeqStart=&ChapAct=FullText
• Title: Public Act 102-0068 (renaming the Act and extending it to all real property, effective January 1, 2022). Publisher: Illinois General Assembly. Publication Date: 2021. URL: https://www.ilga.gov/documents/legislation/publicacts/102/PDF/102-0068.pdf
• Title: 755 ILCS 5/, Probate Act of 1975. Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Not listed. URL: https://www.ilga.gov/Legislation/ILCS/details?ActID=2104&ChapterID=60
• Title: Publication 551, Basis of Assets. Publisher: Internal Revenue Service. Publication Date: Not listed. URL: https://www.irs.gov/publications/p551

It is not legal advice.