You cannot put a beneficiary on your house the same way you do on a bank account or life insurance policy, but four legal tools accomplish essentially the same thing: a transfer-on-death deed, joint tenancy with right of survivorship, a life estate, or a living trust. Each one directs your home to a chosen person at your death and keeps the property out of probate. They differ sharply in how much control you keep, what they cost, how they interact with taxes and mortgages, and whether they help or hurt if Medicaid ever enters the picture.
Transfer-on-Death Deeds
A transfer-on-death (TOD) deed is the closest thing to naming a beneficiary directly on your house. You sign a deed naming who should inherit the property, record it with your county, and that’s it. The beneficiary gets nothing while you’re alive and has no say in what you do with the property. You can sell it, refinance it, rent it out, or revoke the TOD deed entirely without telling the beneficiary.1Legal Information Institute. Transfer-on-Death Deed
The catch: roughly 30 states and the District of Columbia currently recognize TOD deeds. New York, Florida, Pennsylvania, New Jersey, and Michigan are among those that do not authorize them as of 2026. If your state doesn’t allow TOD deeds, the document has no legal effect. Confirm your state’s rule before drafting one.
When you die, the beneficiary typically files a copy of the death certificate and an affidavit with the county recorder to establish ownership. No probate court involvement is needed. You can also name a backup beneficiary in case your first choice dies before you do.
Joint Tenancy With Right of Survivorship
Joint tenancy adds another person to your deed as a co-owner right now, not at death. When one joint tenant dies, the surviving tenant automatically absorbs the deceased owner’s share.2Legal Information Institute. Joint Tenancy This happens by operation of law and overrides whatever the deceased owner’s will says.
The tradeoff is that you give up sole control immediately. All joint tenants share equal ownership rights, and major decisions like selling or taking out a mortgage generally require everyone’s agreement. If one joint tenant sells their share to a stranger, the joint tenancy breaks and converts to a tenancy in common, which eliminates the automatic survivorship feature.
Creditors can also attach liens to a joint tenant’s share during that person’s lifetime. If the debtor joint tenant dies first, most jurisdictions extinguish the lien because the deceased’s interest ceases to exist. If the debtor outlives the other tenant, creditors can reach the entire property. That risk gets overlooked when people add a child or partner to a deed.
Life Estates
A life estate splits your property into two interests: yours for the rest of your life, and someone else’s (the “remainderman”) starting at your death. You keep the right to live in and use the property, but full ownership transfers automatically to the remainderman when you die. No probate.
The limitation is significant. A life tenant can technically sell or transfer their interest, but the buyer only acquires the right to use the property for the original life tenant’s remaining lifetime. Once the life tenant dies, the buyer’s interest vanishes and ownership passes to the remainderman. In practice, this makes the property nearly impossible to sell on the open market without the remainderman’s cooperation. The same applies to refinancing: lenders are reluctant to issue mortgages on a life estate because the collateral disappears at death.
Life estates are also difficult to undo. Changing the remainderman usually requires that person’s agreement, which creates an awkward dynamic if your relationship sours or your plans change. Life estates work best when you’re highly confident about both the beneficiary and your long-term plans.
Living Trusts
A revocable living trust gives you the most flexibility. You transfer your property’s title into the trust, name yourself as the initial trustee (keeping full control), and designate who inherits when you die. You can change beneficiaries, sell the property, refinance, or dissolve the trust entirely at any point during your lifetime.
When you die, the successor trustee you named distributes the property according to the trust document. No probate is needed, and unlike a will, a trust remains private. The main downsides are cost and complexity. Setting up a trust and properly transferring your deed into it costs more than recording a simple TOD deed, and forgetting to re-title the property into the trust is a common mistake that defeats the purpose entirely.
An irrevocable trust is a different animal. Once you transfer property into one, you generally cannot take it back or change the terms. That loss of control is the point: because you no longer own the asset, it may be shielded from creditors and excluded from your taxable estate. Irrevocable trusts are typically used by people with larger estates or specific Medicaid planning needs.
Tax Consequences Worth Checking First
Gift Tax
A TOD deed does not trigger gift tax because nothing transfers while you’re alive. The same is true for a revocable living trust. A life estate similarly does not create a completed gift for the remainderman interest in most cases where you retain the right to use the property.
Joint tenancy is the outlier. Adding a non-spouse co-owner to your deed is treated as a gift of their ownership share. Add your adult child to a home worth $400,000 and you’ve made a $200,000 gift. That won’t necessarily generate a tax bill because the lifetime gift and estate tax exemption for 2026 is $15 million per person, but it does require filing a gift tax return, and it reduces your available exemption.3Internal Revenue Service. Whats New – Estate and Gift Tax
Stepped-Up Basis
When you inherit property, your tax basis is generally “stepped up” to the property’s fair market value at the date of death.4Office of the Law Revision Counsel. 26 U.S. Code 1014 – Basis of Property Acquired From a Decedent This matters enormously if the beneficiary later sells. A home purchased for $150,000 that’s worth $450,000 at death would give the beneficiary a $450,000 basis, potentially wiping out $300,000 in taxable capital gains.
The stepped-up basis applies fully to property passing through a TOD deed or a trust, and to property where the original owner retained a life estate. Joint tenancy is trickier. When non-spouses hold property as joint tenants, only the portion included in the deceased tenant’s estate receives a step-up. If you paid for the entire property but added your child as a joint tenant, the child’s half may not get stepped up unless you can prove the full value belonged to the decedent. Surviving spouses, by contrast, generally receive a full step-up on jointly held property.
Estate Tax
The federal estate tax exemption for 2026 is $15 million per person, with no sunset provision.3Internal Revenue Service. Whats New – Estate and Gift Tax Estates below that threshold owe no federal estate tax regardless of how the property transfers. The method you choose changes how quickly and cleanly the property reaches your beneficiary, not whether estate tax applies.
Your Mortgage and the Due-on-Sale Clause
Most mortgages include a due-on-sale clause that lets the lender demand full repayment if you transfer the property. This scares people away from retitling a home into a trust or adding a joint tenant, but federal law provides important protections.
Under the Garn-St. Germain Act, lenders cannot enforce a due-on-sale clause when you transfer your home into a living trust where you remain a beneficiary and the transfer doesn’t change who lives there.5Office of the Law Revision Counsel. 12 U.S. Code 1701j-3 – Preemption of Due-on-Sale Prohibitions The same law protects transfers at death through joint tenancy, transfers to a spouse or children, and transfers resulting from divorce. A TOD deed should not trigger the clause either, since nothing transfers until you die.
Where people run into trouble is transferring a home to an irrevocable trust or to an unrelated person during their lifetime. Those transfers may not fall under the Garn-St. Germain protections, and the lender could technically call the loan due. In practice, lenders rarely enforce the clause as long as payments keep coming, but “rarely” is not “never.”
Medicaid and the Five-Year Look-Back
If you or a family member may need long-term care, the way you handle your home matters for Medicaid eligibility. Federal law requires state Medicaid programs to recover benefits paid for nursing facility care, home and community-based services, and related costs from the estates of recipients who were 55 or older when they received those benefits.6Medicaid.gov. Estate Recovery
Transferring your home for less than fair market value before applying for Medicaid triggers a penalty period during which you’re ineligible for benefits. The look-back window is 60 months (five years) before the date you apply.7Office of the Law Revision Counsel. 42 U.S. Code 1396p – Liens, Adjustments and Recoveries, and Transfers of Assets The penalty length equals the value of the transferred asset divided by the average monthly cost of nursing home care in your state. Give away a home worth $300,000 in a state where the monthly rate is $10,000, and you face roughly 30 months of ineligibility.
This applies to TOD deeds, life estates, trust transfers, and gifts of joint tenancy interests made within the look-back period. A few protections exist. Medicaid generally cannot recover against a home where a surviving spouse still lives, or where a minor or disabled child resides. Some states also exempt the home entirely if the recipient returns to it. These exceptions are narrow and vary significantly by state. One thing to know: the federal annual gift tax exclusion does not shield transfers from Medicaid penalties, which trips up a surprising number of families.
Choosing and Putting It in Place
The right method depends on what matters most to you. If keeping full control and the ability to change your mind is the priority, a TOD deed (where available) or a revocable living trust gives you the most freedom. If you want someone to share ownership and responsibility right now, joint tenancy accomplishes that but at the cost of flexibility and clean tax treatment. If your goal is Medicaid planning and you can afford to give up control well in advance, a life estate or irrevocable trust may protect the home, provided the transfer falls outside the five-year look-back window.
One mistake comes up constantly: people pick a method based on what’s cheapest to set up rather than what’s cheapest overall. A TOD deed costs almost nothing to create, but it won’t help with Medicaid planning. A trust costs more upfront but can save tens of thousands in probate fees, tax complications, or Medicaid penalties down the road. Run the numbers for your actual situation before defaulting to the simplest option.
Once you’ve chosen, pull your current deed. You’ll need the full legal description of the property exactly as it appears on the recorded deed, not just the street address, plus the full legal names of your intended beneficiaries and any backup beneficiaries. Every deed must be signed in front of a notary public, and some jurisdictions require one or two witnesses. Precise language matters: a poorly worded deed can accidentally create a tenancy in common instead of a joint tenancy, or fail to clearly reserve your life estate. Then record the signed deed with the county recorder or clerk’s office where the property sits. An unrecorded deed is not effective against third parties and can create serious title problems.