Most of us in Northeast Ohio own at least one vehicle. Understanding what happens to our cars after the owner dies can help you make choices for your estate plan.
The default rule is that cars are in fact probate assets. When a car is titled in just one person’s name and that person dies, the car will need to pass through probate court before the family can sell or transfer the title. This is true even if the will leaves the car to a specific person.
Probate is a court proceeding that takes time and money. Probate proceedings can last a year or more, and court costs and attorney’s fees are paid from the money in the estate. Minimizing the amount of your estate that will need to pass through probate court can help to maximize the amount you are able to leave to your loved ones.
You can keep your cars out of probate several different ways:
Transfer on Death (“TOD”) Designation on the Car’s Title
You can include a Transfer on Death (“TOD”) designation on the title of your car if you want to name who will receive the car after your death. To add a TOD designation, bring a signed and notarized Affidavit to Designate a Beneficiary (BMV Form 3811) to your local Title Office, which will issue a new title with the TOD designation.
Once you add a TOD designation to a car’s title, do not leave that car to someone in your will. The TOD designation is all that you need. The beneficiary becomes the new owner of the car by bringing the car’s title and a certified copy of the death certificate of the previous owner to the Title Office and applying for a certificate of title.
A TOD designation makes sense for single people in estate planning. The TOD beneficiary has no rights to the car while you are alive, nor do they have any responsibility for the vehicle.
Joint with Right of Survivorship (“WROS”) Title
Another estate planning technique to avoid probate is to title a vehicle Joint With Right of Survivorship (“WROS”). With a WROS title, two people jointly own a car while they are alive. After the first owner dies, the second owner takes title to the car without needing to probate the vehicle.
When you buy a car, you can title the vehicle in two names and include the letters WROS. You can also update an existing title to be joint WROS. To keep the vehicle out of probate, it is not enough to list two owners on the title, i.e. “John Doe and Mary Doe.” The title must include the WROS designation, i.e. “John Doe and Mary Doe or WROS.”
If you own a car joint WROS, do not leave that car to anyone in your will. Once the vehicle is titled joint WROS, after one owner dies, the surviving owner is the sole owner of the vehicle. To update the title showing that there is only one owner, the surviving owner applies for a certificate of title by bringing the vehicle’s title and a certified copy of the death certificate to the Title Office.
A WROS title can make sense for couples in estate planning. Two people own the car together while they are alive. As co-owners, they are both responsible for the car’s maintenance and insurance.
Surviving Spouse Transfer
Estate planning for cars is often overlooked. Many car owners never use TOD or WROS for their vehicles’ titles, which would typically mean the vehicles must go through probate. Married couples have an option to circumvent probating vehicles even if the titles were not TOD or WROS.
When a married person dies, the surviving spouse can transfer an unlimited number of vehicles worth up to $65,000 into the surviving spouse’s name without needing to probate those vehicles. To transfer the vehicles, the surviving spouse applies for a certificate of title at the Title Office and brings the car’s title, a certified copy of their spouse’s death certificate, and a Clerk of Court Surviving Spouse Affidavit (BMV Form 3773).
For some vehicles, a surviving spouse cannot transfer the title into their name. For example, the surviving spouse cannot take title to cars that had a TOD designation or WROS title for someone other than the surviving spouse. Additionally, if the deceased spouse’s will left the vehicle to someone other than the spouse, then the surviving spouse cannot transfer the car into their own name.
There can be many nuances to estate planning and probate for vehicles. It is best to speak with a local estate planning or probate attorney before changing a car’s title for estate planning or probate purposes. For estate planning and probate questions in Northeast Ohio, Lewis Legal, LLC is here to help.
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