West Virginia’s State Legal Code in §36-12 states that its citizens have the right to use a Transfer-On-Death Deed (“TOD Deed“, or “TODD“), also known as “Lady Bird Deeds,” to transfer property to their beneficiaries when they pass away.
The goals of Lady Bird Deeds in West Virginia are to avoid probate and facilitate a smooth transfer of property ownership to a designated beneficiary upon the owner’s death. West Virginia’s law requires that a TOD Deed must be signed by the owner, notarized, and recorded in the county land records before the owner’s death.
A Lady Bird Deed in West Virginia is “nontestamentary,” meaning that it does not require a will to pass on a piece of property to an inheritor or beneficiary. The deed must be registered while the owner is still alive in the office of the county clerk in the same county where the property is physically located.
The beneficiary can be an individual, a corporation, an LLC, or a trust. You can have multiple beneficiaries — so, your Transfer-on-Death Deed could specify that one beneficiary receives 50% of a property, another 30%, and another 20% — all three beneficiaries would receive their allotted portions of the property once you pass on. A transfer on death deed is revocable even if the deed or another instrument says otherwise — so, you can set one up, and if you change your mind later, you may revoke the deed.
No tax is due when a Lady Bird Deed is set up and registered because the property remains in the hands of the transferor/owner and it remains revocable while they are alive — meaning that the property has not yet changed hands in the eyes of the law until the moment when the transferor/owner dies, and the deed creates the legal mechanism that formally transfers the property into the ownership of the beneficiary.
You do not have to tell the beneficiary that you have set up a Lady Bird Deed for it to be legally valid, so the beneficiary is not required to be notified of the creation and filing of the deed.
If a property is co-owned, such as by a married couple who wish to pass the property on to one or more children after they die, the property remains owned and non-transferred as long as one of the transferors is still alive. So, for instance, if a married couple set up a Lady Bird Deed (Transfer-on-Death Deed) that will convert ownership over to their child after they die, and if the husband passes away before the wife, the entire property remains owned by the wife until she ultimately passes away — at which time the property then passes over to their child.
If one owns only an interest in a property, such as if a business partner owns a 50% stake in a property, then they may set up a Lady Bird Deed for their interest in the property. For example, if a business partner owns 50%, then a Lady Bird Deed can pass their property over to a son or daughter or spouse when they die. Once that partner dies, their 50% portion of the property immediately becomes owned by their beneficiary (or beneficiaries).
Technically, a Lady Bird Deed or Transfer-on-Death Deed may not protect your home from Medicaid Estate Recovery should you need long-term care. West Virginia may file a Medicaid lien against your property in such a case, potentially resulting in you being unable to leave your property to your beneficiaries. There are other legal options, or a combination of legal options — such as a Lady Bird Deed in combination with other legal instruments or factors, that could potentially achieve your goals, so it is very important to consult with an attorney who is experienced with elder care and inheritance laws.
