Even if your state doesn't let you register vehicles in transfer-on-death form, and you don't own it in joint tenancy, the person who inherits your car—through your will, for example—may still be able to take title to it without probate court proceedings.
It depends on where you live. Some states have special nonprobate transfer procedures just for vehicles. All the new owner (the person inheriting the car) must do is complete a simple written statement (affidavit) setting out some basic facts, sign it in front of a notary public, and file it with the state agency that registers vehicles. For example, in Hawaii, a vehicle, regardless of value, can be transferred to its new owner by affidavit. (Haw. Rev. Stat. § 560:3-1201.) In Utah, up to four vehicles can be transferred this way if the rest of the deceased person's estate is worth $100,000 or less. (Utah Code Ann. § 75-3-1201.)
But in many states, there's an important restriction: The affidavit procedure is available only if probate isn't necessary for any of your other assets. If a regular probate proceeding is going on, the car must go through that process. If you want to know the specifics of your state's paperwork, contact a local office of the state motor vehicles agency.
Don't overlook simple procedures for small estates. Even if your state does not have a special transfer procedure just for vehicles, your inheritors may still be able to transfer a vehicle—and everything else you leave—without probate if the value of your estate is small enough.
EXAMPLE: Graham, an Oregon resident, dies owning a house, car, several mutual fund accounts, a bank account, individual retirement account, and some household furnishings and personal belongings.
Before his death, Graham named pay-on-death beneficiaries for his mutual fund accounts and IRA. He and his wife held their house in tenancy by the entirety and a bank account in joint tenancy with right of survivorship. In his will, he left his personal belongings to his wife and his car to his son.
Whether or not the car qualifies for the affidavit procedure depends on whether probate is required for the rest of Graham's estate. Here's how it breaks down:
|House||No, because owned in tenancy by the entirety with his wife.|
|Personal belongings||No, because value isn't high enough to necessitate probate under Oregon law.|
|IRA, mutual funds||No, because Graham named a pay-on-death beneficiary.|
|Bank account||No, because held in joint tenancy with right of survivorship with his wife.|
|Car||No, because probate is not necessary for any other property. Graham's son can file a simple form with the state Motor Vehicles Division and immediately take title to the car.|
Some states have shortcuts just for the surviving spouse. In Maine, if a married person dies owning any vehicles registered in that state, they automatically pass to the surviving spouse unless a will provides otherwise (or someone who has a legal claim on the car, such as a loan company, refuses to consent). Registration and title are transferred to the surviving spouse with no fee or tax. (Me. Rev. Stat. Ann. tit. 29-A, § 663.)
Similarly, in New York, ownership of a single car worth no more than $25,000 automatically goes to the surviving spouse. (New York EPTL § 5-3.1.)
In Ohio, a surviving spouse automatically gets any vehicles worth up to $65,000 in total value, without probate, unless the deceased spouse left them to someone else by will or transfer-on-death (TOD) registration. (Ohio Rev. Code § 2106.18.)
Michigan also has a special rule for spouses. (Mich. Comp. Laws Ann. § 257.236.) A surviving spouse (or heir, if there is no spouse and no will) can apply to the Secretary of State for a new title and claim a vehicle without probate if:
These are just examples. Check your own state's laws for procedures your family might be able to take advantage of.
If a simplified transfer procedure is available, your state's motor vehicles department may provide a form (at its offices and online) for inheritors to fill out and file.
If there isn't an official form, the person who inherits a vehicle will have to write up an affidavit (a sworn statement, signed in front of a notary public), including whatever information the state law then requires. For example, the affidavit might need to state that no probate proceedings are underway or planned, and list all the known heirs of the deceased person.
Finding out exactly what's required in the affidavit may require looking up the state statute that sets out the specific requirements. You can find your state's statutes at any public law library (available in most courthouses) or online. If you're lucky, your state's website will offer you a table of contents. Start there and look for the sections about vehicles or probate. If that's not available, you can probably search for a particular word.
Some states charge the regular fee to issue a new certificate of ownership; others do it for free.