HB1153 EnrolledLRB097 00025 AJO 47182 b

1    AN ACT concerning civil law.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the
5Illinois Residential Real Property Transfer on Death
6Instrument Act.
 
7    Section 5. Definitions. In this Act:
8    "Beneficiary" means a person that receives residential
9real estate under a transfer on death instrument.
10    "Designated beneficiary" means a person designated to
11receive residential real estate in a transfer on death
12instrument.
13    "Joint owner" means an individual who owns residential real
14estate concurrently with one or more other individuals with a
15right of survivorship. The term includes a joint tenant or a
16tenant by the entirety. The term does not include a tenant in
17common.
18    "Owner" means an individual who makes a transfer on death
19instrument.
20    "Person" means an individual, corporation, business trust,
21land trust, estate, inter-vivos revocable or irrevocable
22trust, testamentary trust, partnership, limited liability
23company, association, joint venture, public corporation,

 

 

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1government or governmental subdivision, agency, or
2instrumentality, or any other legal or commercial entity.
3    "Residential real estate" means real property improved
4with not less than one nor more than 4 residential dwelling
5units, units in residential cooperatives; or, condominium
6units, including the limited common elements allocated to the
7exclusive use thereof that form an integral part of the
8condominium unit; or a single tract of agriculture real estate
9consisting of 40 acres or less which is improved with a single
10family residence.
11    "Transfer on death instrument" means an instrument
12authorized under this Act.
 
13    Section 10. Applicability. This Act applies to only a
14transfer of residential real estate as defined in this Act by
15means of a transfer on death instrument made before, on, or
16after the effective date of this Act, by an owner dying on or
17after the effective date of this Act.
 
18    Section 15. Non-exclusivity. This Act does not affect any
19method of transferring residential real estate otherwise
20permitted under the law of this State.
 
21    Section 20. Transfer on death instrument authorized. An
22owner may transfer residential real estate by a transfer on
23death instrument to one or more beneficiaries as owners,

 

 

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1concurrently or successively, and upon any contingency,
2effective at the owner's death.
 
3    Section 25. Transfer on death instrument revocable. A
4transfer on death instrument is revocable even if the
5instrument or another instrument contains a contrary
6provision.
 
7    Section 30. Transfer on death instrument nontestamentary.
8A transfer on death instrument is a nontestamentary instrument
9and is subject to all other laws governing or affecting
10nontestamentary instruments.
 
11    Section 35. Capacity of owner and agent's authority. The
12capacity required to make or revoke a transfer on death
13instrument is the same as the capacity required to make a will.
14Unless expressly authorized by the owner under a power of
15attorney or similar instrument creating an agency, an agent for
16an owner does not have the authority to create or revoke a
17transfer on death instrument.
 
18    Section 40. Requirements.
19    (a) A transfer on death instrument:
20        (1) must contain the essential elements and
21    formalities of a properly recordable inter vivos deed; and
22    must be executed, witnessed, and acknowledged in

 

 

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1    compliance with Section 45;
2        (2) must state that the transfer to the designated
3    beneficiary is to occur at the owner's death; and
4        (3) must be recorded before the owner's death in the
5    public records in the office of the recorder of the county
6    or counties in which any part of the residential real
7    estate is located.
8    (b) The failure to comply with any of the requirements of
9subsection (a) will render the transfer on death instrument
10void and ineffective to transfer title to the residential real
11estate at the owner's death.
 
12    Section 45. Signing, attestation, and acknowledgement.
13Every transfer on death instrument shall be signed by the owner
14or by some person in his or her presence and by his or her
15direction, and shall be attested in writing by 2 or more
16credible witnesses, whose signatures along with the owner's
17signature shall be acknowledged by a notary public. The
18witnesses shall attest in writing that on the date thereof the
19owner executed the transfer on death instrument in their
20presence as his or her own free and voluntary act, and that at
21the time of the execution the witnesses believed the owner to
22be of sound mind and memory.
 
23    Section 50. Notice, delivery, or consideration not
24required. A transfer on death instrument is effective without:

 

 

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1        (1) notice or delivery to the designated beneficiary
2    during the owner's life; or
3        (2) consideration.
 
4    Section 55. Revocation by recorded instrument authorized;
5revocation by act or unrecorded instrument, not authorized.
6     (a) An instrument is effective to revoke a recorded
7transfer on death instrument, or any part of it, only if
8        (1) it is:
9            (A) another transfer on death instrument that
10        revokes the instrument or part of the instrument
11        expressly or by inconsistency; or
12            (B) an instrument of revocation that expressly
13        revokes the instrument or part of the instrument; and
14        (2) it is
15            (A) executed, witnessed, and acknowledged in the
16        same manner as is required by Section 45 on a date that
17        is after the date of the acknowledgment of the
18        instrument being revoked; and
19            (B) recorded before the owner's death in the public
20        records in the office of the recorder of the county or
21        counties where the prior transfer on death instrument
22        is recorded.
23    (b) A transfer on death instrument executed and recorded in
24accordance with this Act may not be revoked by a revocatory act
25on the instrument, by an unrecorded instrument, or by a

 

 

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1provision in a will.
 
2    Section 60. Effect of transfer on death instrument during
3owner's life.
4    (a) During an owner's life, a transfer on death instrument
5does not:
6            (1) affect the right of the owner, any other owner,
7        or an agent for the owner to sell or encumber the
8        residential real estate;
9            (2) affect an interest or right of a transferee,
10        lienholder, mortgagee, option holder or grantee even
11        if the transferee, lienholder, mortgagee, option
12        holder or grantee has actual or constructive notice of
13        the instrument;
14            (3) affect an interest or right of a secured or
15        unsecured creditor or future creditor of the owner,
16        even if the creditor has actual or constructive notice
17        of the instrument;
18            (4) affect the owner's or designated beneficiary's
19        eligibility for any form of public assistance;
20            (5) create a legal or equitable interest in favor
21        of the designated beneficiary; or
22            (6) subject the residential real estate to claims
23        or process of a creditor of the designated beneficiary.
24     (b) If after recording a transfer on death instrument, the
25owner makes a contract for the sale or transfer of the

 

 

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1residential real estate or some part thereof that is the
2subject of the transfer on death instrument and the whole or
3any part of the contract remains executory at the owner's
4death, the disposition of the residential real estate by the
5contract does not revoke the transfer on death instrument but
6the residential real estate passes to the designated
7beneficiary or beneficiary subject to the contract.
 
8    Section 65. Effect of transfer on death instrument at
9owner's death.
10    (a) Except as otherwise provided in the transfer on death
11instrument, in this Section, or in the Probate Act of 1975 or
12any other Act applicable to nontestamentary instruments, on the
13death of the owner, the following rules apply to residential
14real estate that is the subject of a transfer on death
15instrument and owned by the owner at death:
16        (1) Subject to the beneficiary's right to disclaim or
17    refuse to accept the transfer, the interest in the
18    residential real estate is transferred to the beneficiary
19    in accordance with the instrument.
20        (2) If a designated beneficiary fails to survive the
21    owner or is not in existence on the date of the owner's
22    death, then except as provided in paragraph (3) the
23    residential real estate shall pass to the owner's estate.
24        (3) Unless the owner provides otherwise, if the
25    designated beneficiary is a descendant of the owner who

 

 

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1    dies before the owner, the descendants of the deceased
2    designated beneficiary living at the time of the owner's
3    death shall take the residential real estate per stirpes.
4    If the designated beneficiary is one of a class of
5    designated beneficiaries, and any member of the class dies
6    before the owner, the members of the class living when the
7    owner dies shall take the share or shares which the
8    deceased member would have taken if he or she were then
9    living, except that if the deceased member of the class is
10    a descendant of the owner, the descendants of the deceased
11    member then living shall take per stirpes the share or
12    shares which the deceased member would have taken if he or
13    she were then living.
14    (b) Subject to the Probate Act of 1975 and the Conveyances
15Act, a beneficiary takes the residential real estate subject to
16all conveyances, encumbrances, assignments, contracts,
17options, mortgages, liens, and other interests to which the
18residential real estate is subject at the owner's death.
19    (c) A transfer on death instrument transfers residential
20real estate without covenant or warranty of title even if the
21instrument contains a contrary provision.
22    (d) If there is no sufficient evidence of the order of the
23owner and designated beneficiary's deaths, otherwise than
24simultaneously, and there is no other provision in the transfer
25on death instrument, for purposes of this Section, the
26designated beneficiary shall be deemed to have predeceased the

 

 

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1owner.
 
2    Section 70. Joint owners.
3    (a) One or more joint owners may execute a transfer on
4death instrument.
5    (b) If all of the joint owners execute a transfer on death
6instrument, then an instrument of joint owners is revoked only
7if it is revoked by all of the then living joint owners. A
8transfer on death instrument is revocable by the last surviving
9joint owner notwithstanding any contract or agreement between
10the joint owners to the contrary.
11    (c) If less than all of the joint owners execute a transfer
12on death instrument, the transfer on death instrument will be
13governed by the designation of the joint owner who is the last
14to die of all the joint owners. If the last to die joint owner
15did not execute a transfer on death instrument, the designation
16of any prior deceased joint owner is ineffective.
17    (d) A transfer on death instrument shall not sever a joint
18tenancy or tenancy by the entirety.
 
19    Section 75. Notice of death affidavit, acceptance and
20effective date of transfer. A transfer on death instrument is
21effective as of the owner's death upon the filing of a notice
22of death affidavit and acceptance by the beneficiary or
23beneficiaries in the office of the recorder in the county or
24counties where the residential real estate is located. The

 

 

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1notice of death affidavit and acceptance shall contain the name
2and address of each beneficiary who shall take under the
3transfer on death instrument, a legal description of the
4property, the street address, and parcel identification number
5of the residential real estate, the name of the deceased owner,
6and the date of death. The notice of death affidavit and
7acceptance shall be signed by each beneficiary or by the
8beneficiary's authorized representative. If a notice of death
9affidavit and acceptance has not been filed by at least one
10beneficiary or by a beneficiary's authorized representative in
11the office of the recorder in the county or counties where the
12residential real estate is located within 30 days after the
13owner's death, the personal representative of the owner's
14estate, if any, may take possession of the residential real
15estate in accordance with Section 20-1 of the Probate Act of
161975, and shall be entitled to a lien for all reasonable costs
17and expenses incurred in the management and care thereof
18provided that a reasonable attempt to notify the beneficiary or
19beneficiaries has been made. If a notice of death affidavit and
20acceptance has not been filed by at least one beneficiary or by
21the beneficiary's authorized representative in the office of
22the recorder in the county or counties where the residential
23real estate is located within 2 years after the owner's death,
24the transfer on death instrument shall be void and ineffective
25and the residential real estate shall pass to the owner's
26estate as provided in paragraph (2) of subsection (a) of

 

 

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1Section 65 to be administered and distributed in accordance
2with the terms thereof.
 
3    Section 80. Disclaimer. A beneficiary may disclaim all or
4part of the beneficiary's interest as provided by the
5Disclaimer Under Nontestamentary Instrument Act.
 
6    Section 85. Rights of creditors and statutory claimants. A
7beneficiary of a transfer on death instrument is subject to the
8claims of creditors and statutory claimants to the same extent
9as a beneficiary of any nontestamentary transfer.
 
10    Section 90. Limitations. An action to set aside or contest
11the validity of a transfer on death instrument shall be
12commenced within the earlier of 2 years after the date of the
13owner's death or 6 months from the date that letters of office
14are issued.
 
15    Section 95. Preparation of a transfer on death instrument
16or its revocation. A transfer on death instrument or its
17revocation shall be prepared only by an Illinois licensed
18attorney. Nothing in this Section, however, shall prohibit an
19owner from preparing his or her own transfer on death
20instrument or revocation.
 
21    Section 100. Form of notice of death affidavit and

 

 

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1acceptance. The following form shall be used to give notice of
2the owner's death and to accept the transfer by the
3beneficiary:
4(front of form)
5NOTICE: This Notice of Death Affidavit and Acceptance form or
6equivalent form must be recorded by the beneficiary after the
7death of the owner to make the transfer on death instrument
8effective. You should consult a lawyer before using this form.
 
9
NOTICE OF DEATH AFFIDAVIT AND ACCEPTANCE OF
10
TRANSFER ON DEATH INSTRUMENT
11PREPARED BY AND RETURN TO:
 
12SEND SUBSEQUENT TAX BILL TO:
 
13The undersigned beneficiary or beneficiaries, being duly sworn
14on oath, state as follows:
 
15That [name of owner] died on ......... , 20...... , a resident
16of [name of county], [name of state], owning residential real
17estate legally described below:
 
18[legal description or attach exhibit]
 
19That the street address of the residential real estate is
20[address] and the property identification number is [PIN].

 

 

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1That the Transfer on Death Instrument is dated ............ and
2recorded as Document No. ........... in the Office of the
3Recorder for .............. County, Illinois.
 
4That the undersigned whose names and addresses appear below are
5all beneficiaries entitled to receive under the Transfer on
6Death Instrument:
 
7Name       Address                 Share
 
8In witness whereof, the undersigned beneficiaries hereby
9accept the transfer of residential real estate under the
10transfer on death instrument this ........... day of
11............, 20........
 
12........................(Seal)     ....................(Seal)
13[Print Name]                       [Print Name]
 
14STATE OF ILLINOIS
15COUNTY OF ..................
 
16I, the undersigned, a Notary Public in and for the State
17aforesaid, DO HEREBY CERTIFY THAT [NAME OF BENEFICIARY OR
18BENEFICIARIES] personally known to me to be the same person or
19persons whose name or names are subscribed to the foregoing
20instrument, appeared before me this day in person and swore on

 

 

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1oath to the above foregoing affidavit. Signed and sworn to
2before me this ............ day of ..............., A.D. 20....
 
3My commission expires on .............
4
(SEAL)
5.......................................  
6   Notary Public