Category: Probate

April 24, 2023

Death and the Automobile

Blaise Hill

Chances are, you own a motor vehicle. It is less likely that you have spent much time thinking about what happens to that motor vehicle when you die. There are many emotions that come with the death of a loved one, most of which cannot be avoided. Ensuring that your assets transfer easily at your death can ease the administrative part of the grieving process, which may be particularly important for motor vehicles because many households rely on them every day.

If your vehicle is titled in your name alone, then it will be transferred according to your will as part of probate. Probate is the process of administering a will when someone dies and involves the appointment of a personal representative or executor by the court. The appointed person will oversee the payment of debts and the transfer of assets in accordance with the deceased person’s will.

Revocable trusts are a popular tool to avoid probate and some of the anxieties associated with transferring assets at death. Other reasons for a revocable trust include privacy and management of the owner’s assets in the event of diminished capacity. Retitling assets in the name of the trust is a crucial step to ensure the owner’s assets can be managed, invested, and distributed according to the owner’s wishes. However, that does not mean every asset should be titled to a revocable trust. Motor vehicles are a good example.

For one thing, most states require the owner of a motor vehicle to carry automobile insurance; when a motor vehicle is titled in a revocable trust, the insurance company may require that the trust be included on the policy as an insured party. In some cases, this could lead to increased insurance premiums and difficulty securing coverage. Another hurdle may exist for a motor vehicle that is financed; the financing agreement may require the owner to notify the lender of the transfer, and the lender may have the right to deny the transfer. Lastly, even if transferring a motor vehicle to a revocable trust is feasible, the owner may find the process impractical; the numerous steps may not be worth the hassle for an asset that will likely be owned for only a handful of years.

In the rare instance where an owner expects to own a motor vehicle for an extended period, the vehicle is not financed, and the owner is not concerned about updates to the insurance
policy, it may be appropriate to think about the motor vehicle as a collectible, like art, fine wine, or jewelry (the car from Ferris Bueller’s Day Off comes to mind). However, even in that
situation, the owner may still prefer a more convenient alternative for transferring the motor vehicle at death.

In Maryland and Virginia, an owner can designate a Transfer-on-Death (TOD) beneficiary for their motor vehicle. A TOD designation allows the beneficiary to receive title to the vehicle at the owner’s death without going through probate. Only one beneficiary can be designated at a time, and if the beneficiary dies before the owner, the owner will have to designate a new beneficiary. The beneficiary can be changed or updated any number of times.

In addition, Maryland, DC, and Virginia permit an owner of a motor vehicle to title the vehicle with another person as joint tenants with right of survivorship (JTWROS). However, there are pitfalls. For one, a vehicle owned as JTWROS with a spouse may be subject to a dispute about who is entitled to retain the vehicle if the couple goes through a divorce. Titling a
vehicle as JTWROS may also require an update to the insurance policy. These issues, and other potential pitfalls, should be discussed with an estate planning attorney before titling a motor vehicle as JTWROS.

If you do nothing and your motor vehicle is titled in your name alone at your death, probate can be relatively straightforward in some states. For example, Virginia allows a vehicle to be transferred without probate if the owner’s will makes clear who is to receive it and the will does not otherwise need to be admitted to probate; Maryland has a small estate proceeding that simplifies the process for those with relatively low-value assets subject to probate at their death ($50,000, or $100,000 if the spouse is the only recipient of the estate).

Regardless of the type of estate plan you implement, your motor vehicles (cars, trucks, and motorcycles, but also boats, recreational vehicles, and planes) should not be forgotten. A
sound estate plan should contemplate all of your assets. The best approach will be the one that meets your goals and gives you peace of mind.


May 18, 2021

The Secure Act: Elimination of the Stretch Option for Certain Beneficiaries of Inherited Retirement Assets

Micah G. Snitzer

The Setting Every Community Up for Retirement Enhancement Act (the “SECURE Act”) took effect January 1, 2020, revising federal rules that govern the administration of qualified retirement plans (e.g., 401(k) and 403(b) plans) and IRAs.  Among the changes effected by the new law is the shrinking of the class of beneficiaries who can stretch out their […]

October 29, 2020

D.C.’S Estate Tax Exemption Reduced

Micah G. Snitzer

In response to budgetary pressures, D.C. Mayor Muriel Bowser signed the “Estate Tax Adjustment Amendment Act of 2020.”  The Act reduces the estate tax exemption from $5.76million in 2020 to $4 million for decedents dying on or after January 1, 2021.  The exemption amount will be adjusted for inflation starting in 2022 and will continue to […]

January 6, 2020

The SECURE Act: Elimination of the “Stretch” Option for Certain Beneficiaries of Inherited Retirement Assets

Micah G. Snitzer

The Setting Every Community Up for Retirement Enhancement Act (the “SECURE Act”) took effect January 1, 2020, revising federal rules that govern the administration of qualified retirement plans (e.g., 401(k) and 403(b) plans) and IRAs.  Among the changes effected by the new law is the shrinking of the class of beneficiaries who can “stretch” out their […]

February 15, 2018

State Estate and Inheritance Taxes after the Tax Cuts and Jobs Act

Pasternak & Fidis

The doubling of the federal estate tax exemption under the Tax Cuts and Jobs Act—from $5.49 million in 2017 to $11.18 million in 2018 ($11.4 million as of January 1, 2019)—has moved many wealthy Americans away from the impact of the federal estate tax. However, state estate taxes and state inheritance taxes remain a factor in estate planning for residents of […]

October 17, 2017

“To my descendants, per stirpes…” (or… How do we pass the Packers’ tickets to our grandkids?)

Anne W. Coventry

Years ago, I described to a close friend (let’s call her Cathy) the difference between a division among descendants per stirpes and a division among the same descendants per capita at each generation.  In the midst of my explanation, Cathy suddenly exclaimed, “Oh!  You mean like the Packers’ tickets?”  This was a Eureka! moment; yes, […]


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