101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3150

 

Introduced 2/6/2020, by Sen. Jason A. Barickman

 

SYNOPSIS AS INTRODUCED:
 
See Index

    Amends the Illinois Residential Real Property Transfer on Death Instrument Act. Renames the Act the "Real Property Transfer on Death Instrument Act". Changes the definitions of "owner" and "person". Deletes the definition of "residential real estate". Defines "real property". Changes references to "residential real estate property" to references to "real property". Permits the transfer of real property by a transfer on death instrument to a trustee of a trust under certain circumstances even if the trust is subject to amendment, modification, revocation, or termination. Provides that a transfer on death instrument may not be admitted to probate as the will of the owner or as a codicil thereto. Provides that a transfer on death instrument does not need to state consideration or the addresses of the beneficiaries. Provides that if the transfer on death instrument is not witnessed by at least 2 credible witnesses, it is void. Provides that if a beneficiary attests to the execution of the transfer on death instrument, the interest transferred to that beneficiary is void as to that beneficiary. Changes the rules under which real property that is subject to a transfer on death instrument is transferred. Provides that a transfer on death instrument may be renounced by the owner's surviving spouse regardless of whether the transfer on death instrument transfers an interest in real property for the benefit of the surviving spouse. Provides that a creditor may enforce the liability against the real property transferred at the owner's death by a transfer on death instrument and the beneficiaries. Makes other changes to provisions regarding: rights of creditors; limitations; and preparation of a transfer on death instrument or its revocation. Makes conforming changes.


LRB101 16074 LNS 66823 b

 

 

A BILL FOR

 

SB3150LRB101 16074 LNS 66823 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 5. The Illinois Residential Real Property Transfer
5on Death Instrument Act is amended by changing Sections 1, 5,
610, 15, 20, 30, 35, 40, 45, 60, 65, 75, 85, 90, and 95 and by
7adding Sections 21 and 66 as follows:
 
8    (755 ILCS 27/1)
9    Sec. 1. Short title. This Act may be cited as the Illinois
10Residential Real Property Transfer on Death Instrument Act.
11(Source: P.A. 97-555, eff. 1-1-12.)
 
12    (755 ILCS 27/5)
13    Sec. 5. Definitions. In this Act:
14    "Beneficiary" means a person that receives real property
15residential real estate under a transfer on death instrument.
16    "Designated beneficiary" means a person designated to
17receive real property under residential real estate in a
18transfer on death instrument.
19    "Joint owner" means an individual who owns real property
20residential real estate concurrently with one or more other
21individuals with a right of survivorship. The term includes a
22joint tenant or a tenant by the entirety. The term does not

 

 

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1include a tenant in common.
2    "Owner" means an individual who owns an interest in real
3property. "Owner" does not include an individual acting in a
4fiduciary, representative, or agency capacity who holds an
5interest in real property who makes a transfer on death
6instrument.
7    "Person" means: an individual; a corporation; a business
8trust; a trustee of a land trust, inter vivos revocable or
9irrevocable trust, testamentary trust created under a will or
10under a transfer on death instrument; a partnership; a limited
11liability company; an association; a joint venture; a public
12corporation; a government or governmental subdivision; an
13agency; an instrumentality; a guardian; a custodian designated
14or to be designated under any state's uniform transfers to
15minors act; or any other legal entity an individual,
16corporation, business trust, land trust, estate, inter-vivos
17revocable or irrevocable trust, testamentary trust,
18partnership, limited liability company, association, joint
19venture, public corporation, government or governmental
20subdivision, agency, or instrumentality, or any other legal or
21commercial entity.
22    "Real property" means an interest in realty located in this
23State capable of being transferred on the death of the owner.
24    "Residential real estate" means real property improved
25with not less than one nor more than 4 residential dwelling
26units; a residential condominium unit, including but not

 

 

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1limited to the common elements allocated to the exclusive use
2thereof that form an integral part of the condominium unit and
3any parking unit or units specified by the declaration to be
4allocated to a specific residential condominium unit; or a
5single tract of agriculture real estate consisting of 40 acres
6or less which is improved with a single family residence. If a
7declaration of condominium ownership provides for individually
8owned and transferable parking units, "residential real
9estate" does not include the parking unit of a specific
10residential condominium unit unless the parking unit is
11included in the legal description of the property being
12transferred by a transfer on death instrument.
13    "Transfer on death instrument" means an instrument
14authorized under this Act.
15(Source: P.A. 97-555, eff. 1-1-12; 98-821, eff. 1-1-15; revised
167-16-19.)
 
17    (755 ILCS 27/10)
18    Sec. 10. Applicability. This Act applies to only a transfer
19of real property residential real estate as defined in this Act
20by means of a transfer on death instrument made before, on, or
21after the effective date of this Act, by an owner dying on or
22after the effective date of this Act.
23(Source: P.A. 97-555, eff. 1-1-12.)
 
24    (755 ILCS 27/15)

 

 

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1    Sec. 15. Non-exclusivity. This Act does not affect any
2method of transferring real property residential real estate
3otherwise permitted under the law of this State.
4(Source: P.A. 97-555, eff. 1-1-12.)
 
5    (755 ILCS 27/20)
6    Sec. 20. Transfer on death instrument authorized. An owner
7may transfer real property residential real estate by a
8transfer on death instrument to one or more beneficiaries in
9any form of ownership valid under State law, concurrent or
10successive, absolute or conditional, contingent or vested, as
11owners, concurrently or successively, and upon any
12contingency, effective at the owner's death.
13(Source: P.A. 97-555, eff. 1-1-12.)
 
14    (755 ILCS 27/21 new)
15    Sec. 21. Trust as beneficiary. A transfer of real property
16by a transfer on death instrument to a trustee of a trust that
17is in existence when the owner executes a transfer on death
18instrument and that is identified in the transfer on death
19instrument, or to a trustee of a trust under the will of
20another individual if that individual has predeceased the
21owner, is permitted even if the trust is subject to amendment,
22modification, revocation, or termination. Unless the transfer
23on death instrument provides otherwise, the real property
24transferred shall be governed by the terms and provisions of

 

 

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1the instrument creating the trust, including any amendments or
2modifications in writing made at any time before or after the
3execution of the owner's transfer on death instrument and after
4the death of the owner. The existence or lack thereof of a
5trust corpus is immaterial to the validity of the transfer by
6the transfer on death instrument. Unless the transfer on death
7instrument provides otherwise, a revocation or termination of
8the trust before the owner's death causes the transfer to the
9trust to pass to the owner's estate.
 
10    (755 ILCS 27/30)
11    Sec. 30. Transfer on death instrument nontestamentary. A
12transfer on death instrument is a nontestamentary instrument
13and is subject to all other laws governing or affecting
14transfers by nontestamentary instruments. A transfer on death
15instrument may not be admitted to probate as the will of the
16owner or as a codicil thereto.
17(Source: P.A. 97-555, eff. 1-1-12.)
 
18    (755 ILCS 27/35)
19    Sec. 35. Capacity of owner and agent's authority. The
20capacity required to make or revoke a transfer on death
21instrument is the same as the capacity required to make a will.
22An agent under a durable power of attorney or other instrument
23creating an agency, even if authorized, does not have the
24authority to create or revoke a transfer on death instrument on

 

 

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1behalf of the owner. This Section shall not be construed to
2prohibit the agent from selling, transferring, or encumbering
3the real property residential real estate under the terms of
4the agency.
5(Source: P.A. 97-555, eff. 1-1-12; 98-821, eff. 1-1-15.)
 
6    (755 ILCS 27/40)
7    Sec. 40. Requirements.
8    (a) A transfer on death instrument:
9        (1) must: (i) contain the essential elements and
10    formalities of a properly recordable inter vivos deed, but
11    does not need to state consideration or the addresses of
12    the beneficiaries; and (ii) must be executed, witnessed,
13    and acknowledged in substantial compliance with Section
14    45;
15        (2) must state that the transfer to the designated
16    beneficiary is to occur at the owner's death; and
17        (3) must be recorded before the owner's death in the
18    public records in the office of the recorder of the county
19    or counties in which any part of the real property
20    residential real estate is located.
21    (b) The failure to comply with any of the requirements of
22subsection (a) will render the transfer on death instrument
23void and ineffective to transfer title to the real property
24residential real estate at the owner's death.
25(Source: P.A. 97-555, eff. 1-1-12; 98-821, eff. 1-1-15.)
 

 

 

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1    (755 ILCS 27/45)
2    Sec. 45. Signing, attestation, and acknowledgment
3acknowledgement.
4    (a) Every transfer on death instrument shall be signed by
5the owner or by some person in his or her presence and by his or
6her direction, and shall be attested in writing by 2 or more
7credible witnesses, and the whose signatures of the witnesses
8along with the owner's signature shall be acknowledged in front
9of by a notary public. The witnesses shall attest in writing
10substantially as follows: (i) that on the date thereof the
11owner executed the transfer on death instrument in the their
12presence of the witnesses; (ii) that the owner's execution was
13as his or her own free and voluntary act; , and (iii) that at
14the time of the execution, the witnesses believed the owner to
15be of sound mind and memory.
16    (b) Except as provided in subsection (c), if the transfer
17on death instrument is not witnessed by at least 2 credible
18witnesses, it is not executed in substantial compliance with
19subsection (a) and is void.
20    (c) If a beneficiary, or his or her spouse, attests to the
21execution of the transfer on death instrument, the interest
22transferred to that beneficiary and all persons claiming under
23him or her is void as to that beneficiary unless the transfer
24on death instrument is otherwise duly attested by a sufficient
25number of witnesses as under subsection (a) exclusive of that

 

 

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1person and the notary, and he or she may be compelled to
2testify as if the interest had not been given, but the
3beneficiary is entitled to receive so much of the interest or
4share given to him or her by the transfer on death instrument
5not to exceed the value or share that he or she would have
6received had no transfer on death instrument been established.
7(Source: P.A. 97-555, eff. 1-1-12.)
 
8    (755 ILCS 27/60)
9    Sec. 60. Effect of transfer on death instrument during
10owner's life.
11    (a) During an owner's life, a transfer on death instrument
12does not:
13            (1) affect the right or interest of the owner, any
14        other owner, or an agent for the owner to sell,
15        transfer, or encumber the real property residential
16        real estate;
17            (2) affect an interest or right of a transferee,
18        lienholder, mortgagee, or option holder or grantee
19        even if the transferee, lienholder, mortgagee, or
20        option holder or grantee has actual or constructive
21        notice of the instrument;
22            (3) affect an interest or right of a secured or
23        unsecured creditor or future creditor of the owner,
24        even if the creditor has actual or constructive notice
25        of the instrument;

 

 

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1            (4) affect the owner's or designated beneficiary's
2        eligibility for any form of public assistance;
3            (5) create a legal or equitable interest in favor
4        of the designated beneficiary; or
5            (6) subject the real property residential real
6        estate to claims or process of a creditor of the
7        designated beneficiary.
8     (b) If after recording a transfer on death instrument, the
9owner makes a contract for the sale or transfer of the real
10property residential real estate or some part thereof that is
11the subject of the transfer on death instrument and the whole
12or any part of the contract remains executory at the owner's
13death, the disposition of the real property residential real
14estate by the contract does not revoke the transfer on death
15instrument but the real property residential real estate passes
16to the designated beneficiary or beneficiary subject to the
17contract.
18(Source: P.A. 97-555, eff. 1-1-12.)
 
19    (755 ILCS 27/65)
20    Sec. 65. Effect of transfer on death instrument at owner's
21death.
22    (a) Except as otherwise provided in the transfer on death
23instrument, in this Act Section, or in the Probate Act of 1975,
24or in any other Act applicable to nontestamentary instruments,
25on the death of the owner, the following rules apply to the

 

 

SB3150- 10 -LRB101 16074 LNS 66823 b

1real property residential real estate that is the subject of a
2transfer on death instrument and owned by the owner at death:
3        (1) Subject to the beneficiary's right to disclaim the
4    transfer, the interest in the real property residential
5    real estate is transferred to the beneficiary in accordance
6    with the instrument.
7        (2) If the owner has identified 2 or more designated
8    beneficiaries to receive concurrent interests in the real
9    property, the interests are taken in equal and undivided
10    shares with no right of survivorship. If a designated
11    beneficiary fails to survive the owner or is not in
12    existence on the date of the owner's death, then except as
13    provided in paragraph (3) the residential real estate shall
14    pass to the owner's estate.
15        (3) Except as provided in paragraph (5), if the owner
16    has identified a single designated beneficiary and the
17    designated beneficiary fails to survive the owner or is not
18    in existence on the date of the owner's death, then the
19    real property shall pass to the owner's estate. Unless the
20    owner provides otherwise, if the designated beneficiary is
21    a descendant of the owner who dies before the owner, the
22    descendants of the deceased designated beneficiary living
23    at the time of the owner's death shall take the residential
24    real estate per stirpes. If the designated beneficiary is
25    one of a class of designated beneficiaries, and any member
26    of the class dies before the owner, the members of the

 

 

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1    class living when the owner dies shall take the share or
2    shares which the deceased member would have taken if he or
3    she were then living, except that if the deceased member of
4    the class is a descendant of the owner, the descendants of
5    the deceased member then living shall take per stirpes the
6    share or shares which the deceased member would have taken
7    if he or she were then living.
8        (4) Except as provided in paragraph (5), if the owner
9    has identified 2 or more designated beneficiaries to
10    receive concurrent interests, and one or more designated
11    beneficiaries predecease the owner, then the interest of
12    the one that lapses or fails for any reason is transferred
13    to the other remaining designated beneficiary or
14    beneficiaries in proportion to the interest of each in the
15    remaining part of the real property held concurrently.
16        (5) If the designated beneficiary who dies before the
17    owner is a descendant of the owner, the descendants of the
18    deceased designated beneficiary living at the time of the
19    owner's death shall take the deceased designated
20    beneficiary's share of the real property per stirpes.
21    (b) Subject to the Probate Act of 1975 and the Conveyances
22Act, a beneficiary takes the real property residential real
23estate subject to all conveyances, encumbrances, assignments,
24contracts, options, mortgages, liens, and other interests to
25which the real property residential real estate is subject at
26the owner's death.

 

 

SB3150- 12 -LRB101 16074 LNS 66823 b

1    (c) A transfer on death instrument transfers real property
2residential real estate without covenant or warranty of title
3even if the instrument contains a contrary provision.
4    (d) If there is no sufficient evidence of the order of the
5owner and designated beneficiary's deaths, otherwise than
6simultaneously, and there is no other provision in the transfer
7on death instrument, for purposes of this Section, the
8designated beneficiary shall be deemed to have predeceased the
9owner.
10(Source: P.A. 97-555, eff. 1-1-12; 98-821, eff. 1-1-15.)
 
11    (755 ILCS 27/66 new)
12    Sec. 66. Renunciation by spouse.
13    (a) Unless the right to renounce is waived by the owner's
14surviving spouse, a transfer on death instrument may be
15renounced by the owner's surviving spouse regardless of whether
16the transfer on death instrument transfers an interest in real
17property for the benefit of the surviving spouse. If renounced,
18the surviving spouse is entitled to a one-third interest in the
19real property transferred by the transfer on death instrument
20if the owner leaves a descendant or a one-half interest in the
21real property if the owner leaves no descendant. The surviving
22spouse may waive his or her right to renounce by executing a
23waiver as part of the transfer on death instrument.
24    (b) In order to renounce the transfer on death instrument,
25the owner's surviving spouse must file, in the recorder of

 

 

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1deeds office where the transfer on death instrument is
2recorded, a written instrument signed by the surviving spouse
3setting forth a description of the real property and declaring
4the renunciation. The instrument shall be filed within 6 months
5after the date of the owner's death. The filing of the
6instrument renouncing the transfer on death instrument is a
7complete bar to any claim of the surviving spouse under the
8transfer on death instrument.
9    (c) If a transfer on death instrument is renounced under
10this Section, any future interest that is to take effect in
11possession or enjoyment at or after the termination of an
12estate or other interest given by the transfer on death
13instrument to the surviving spouse takes effect as though the
14surviving spouse had predeceased the owner, unless the transfer
15on death instrument expressly provides that in the case of
16renunciation the future interest shall not be accelerated.
17    (d) If the surviving spouse of the owner renounces the
18transfer on death instrument and the interests transferred to
19other persons are thereby diminished or increased, upon
20petition by a beneficiary, the court shall abate from or add to
21any interest transferred in such a manner as to apportion the
22loss or advantage among the beneficiaries in proportion to
23their respective interests.
 
24    (755 ILCS 27/75)
25    Sec. 75. Notice of death affidavit. Any beneficiary who

 

 

SB3150- 14 -LRB101 16074 LNS 66823 b

1takes under a transfer on death instrument may file in the
2office of the recorder in the county or counties where the real
3property residential real estate is located a notice of death
4affidavit to confirm title following the death of the owner.
5The notice of death affidavit shall contain the name and
6address, if known, of each beneficiary taking under the
7transfer on death instrument, the legal description of the
8property, the street address and parcel identification number
9of the real property residential real estate, if known, the
10date of the transfer on death instrument and its recording
11document number, the name of the deceased owner, the date and
12place of death, and the name and address to which all future
13tax bills should be mailed. The affidavit shall be acknowledged
14under penalty of perjury before a notary public or person
15authorized to administer oaths. The filing of the notice of
16death affidavit is not a condition to the transfer of title.
17(Source: P.A. 97-555, eff. 1-1-12; 98-821, eff. 1-1-15.)
 
18    (755 ILCS 27/85)
19    Sec. 85. Rights of creditors and statutory claimants.
20    (a) To the extent the owner's probate estate is
21insufficient to satisfy an allowed claim against the estate, a
22creditor may enforce the liability against the real property
23transferred at the owner's death by a transfer on death
24instrument and the beneficiaries thereof under Sections 10
25through 14 of the Frauds Act.

 

 

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1    (b) If more than one real property is transferred by one or
2more transfer on death instruments, the liability under
3subsection (a) shall be apportioned among the real properties
4in proportion to their net values at the owner's death.
5A beneficiary of a transfer on death instrument is subject to
6the claims of creditors and statutory claimants to the same
7extent as a beneficiary of any nontestamentary transfer.
8(Source: P.A. 97-555, eff. 1-1-12.)
 
9    (755 ILCS 27/90)
10    Sec. 90. Limitations. An action to set aside, or contest
11the validity of a transfer on death instrument, or assert a
12claim or liability against the real property transferred
13thereunder shall be commenced within, and not after, the time
14limited by Section 13-220 of the Code of Civil Procedure the
15earlier of 2 years after the date of the owner's death or 6
16months from the date that letters of office are issued.
17However, a purchaser or mortgagee for value and without notice
18before the recording recordation of a notice of lis pendens
19under Section 2-1901 of the Code of Civil Procedure or before
20the recording of a renunciation for an action to set aside or
21contest the transfer on death instrument for any reason shall
22take free and clear of any such action, liability, claim, or
23contest.
24(Source: P.A. 97-555, eff. 1-1-12; 98-821, eff. 1-1-15.)
 

 

 

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1    (755 ILCS 27/95)
2    Sec. 95. Preparation of a transfer on death instrument or
3its revocation. A transfer on death instrument or its
4revocation shall be prepared only by a an Illinois licensed
5attorney. Nothing in this Section, however, shall prohibit an
6owner from preparing his or her own transfer on death
7instrument or revocation, or shall render the transfer on death
8instrument void for failing to be prepared by a licensed
9attorney.
10(Source: P.A. 97-555, eff. 1-1-12.)

 

 

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1 INDEX
2 Statutes amended in order of appearance
3    755 ILCS 27/1
4    755 ILCS 27/5
5    755 ILCS 27/10
6    755 ILCS 27/15
7    755 ILCS 27/20
8    755 ILCS 27/21 new
9    755 ILCS 27/30
10    755 ILCS 27/35
11    755 ILCS 27/40
12    755 ILCS 27/45
13    755 ILCS 27/60
14    755 ILCS 27/65
15    755 ILCS 27/66 new
16    755 ILCS 27/75
17    755 ILCS 27/85
18    755 ILCS 27/90
19    755 ILCS 27/95