TODD v. Lady Bird Deeds in Texas

Both a transfer on death deed (TODD) and a lady bird deed allow a grantor to transfer real property outside probate while retaining control over the property during the grantor’s lifetime. TODDs and lady bird deeds are the most commonly used methods of achieving these goals. But what’s the difference between the two types of Texas deeds?

Before we go into the primary differences, it’s important to understand what TODDs and lady bird deeds are. A TODD is authorized by Texas statute and allows a grantor to designate a beneficiary of real property at death, much like a payable-on-death designation on a bank account. A lady bird deed is recognized by case law (not statute) and allows a grantor to retain an enhanced life estate with complete control over the property and to pass the property to a beneficiary at death. The ultimate outcome with both deeds is essentially the same, but there are some stark differences between the two deeds.

The following table summarizes the main differences:

Either a TODD or a lady bird deed may be an appropriate component of an estate plan. Johnsen Law prepares these deeds and handles other aspects of estate planning. Contact Johnsen Law to learn more.