In Owings and across northern Calvert County, homes stay in families across generations. Keeping the family home out of probate and in family hands requires specific planning tools. Maryland’s transfer on death deed is one of the most useful. Here is how it works and what other options Owings families should consider.
Owings is one of those Calvert County communities where family homes carry history. Houses have been built on land that came down from grandparents. Holiday dinners happen in kitchens where three generations have cooked. The family home is not just an asset on a balance sheet. It is a place that anchors family life.
Keeping that home in family hands after the current owner passes takes planning. Maryland law provides several tools, each with different benefits and limits. At The Law Offices of Haskell and Dyer, we help Owings families choose the approach that fits their specific situation. Here is the overview.
Why the Family Home Matters in Estate Planning
For many Owings families, the home is the estate’s single largest asset. It is also the asset most likely to carry strong emotional meaning. The planning decisions around the home affect:
- Whether the home goes through probate or passes directly
- What the tax consequences look like for the heirs
- How multiple heirs share ownership (or do not)
- Whether the home can be sold easily if the family decides to sell
- How long term care costs might affect the home
- Whether the home qualifies for Maryland homestead and senior property tax benefits
The Transfer on Death Deed
Maryland recognizes transfer on death deeds (TODDs) for real property. Under a TODD, the owner names a beneficiary who will automatically receive title to the property at the owner’s death, without probate. The owner retains full control during their lifetime and can revoke or change the deed at any time.
How TODDs Work
- The owner signs and records a transfer on death deed with the Calvert County land records office
- The deed names one or more beneficiaries
- The owner retains all rights to use, mortgage, or sell the property during their lifetime
- At the owner’s death, the named beneficiary files an affidavit with the land records office
- The beneficiary takes title without probate
Benefits of TODDs
- No probate for the real estate
- Simple and relatively inexpensive to implement
- Revocable at any time during the owner’s life
- Does not affect the owner’s homestead status or property tax benefits
- Preserves the capital gains step up at death
- Does not require transferring the property into a trust
Limits of TODDs
- Only addresses the real estate, not other assets
- Does not handle contingencies well if the beneficiary predeceases the owner
- Multiple named beneficiaries take as tenants in common, which can create operational complications
- Does not provide liability protection during the owner’s life
- Does not address potential Medicaid recovery if the owner eventually needs long term care
Practical note: A TODD is often the simplest solution for single owners who want to pass a home to a single primary beneficiary. For more complex situations (multiple children, significant assets, concerns about creditors or long term care), a trust is usually more appropriate.
Alternative Approaches
Revocable Living Trust
The home can be transferred into a revocable living trust during the owner’s lifetime. The trust holds the property, the owner retains full control as trustee, and at death the successor trustee distributes the property according to the trust terms. Trust ownership provides more flexibility than a TODD, particularly for multiple beneficiaries or contingent beneficiaries.
Joint Ownership with Right of Survivorship
Adding a spouse or family member to the deed as a joint tenant with right of survivorship allows the property to pass automatically to the survivor. This works well for spouses but less well for parent child arrangements because it creates gift tax issues, exposes the property to the child’s creditors, and can complicate long term care planning.
Life Estate Deed
A life estate retains the right to live in and control the property for the owner’s lifetime, with the property passing automatically to a named remainder beneficiary at death. Life estates have been used for decades in Maryland, but they can create complications for Medicaid planning and are less flexible than trusts.
Direct Transfer During Lifetime
Some families consider transferring the home to children during the parent’s lifetime. This approach loses the capital gains step up, creates gift tax reporting requirements, and can trigger the Medicaid lookback. It is rarely the best option unless it is part of a broader planning strategy.
Multi-Generational Planning
For Owings families who want the home to stay in the family for more than one generation, planning needs to look further ahead. A trust can hold the home for multiple generations with clear rules about:
- Which family members can use the home and under what conditions
- How maintenance and property tax costs are shared
- Who can sell the property and under what circumstances
- How the trust distributes proceeds if the home is eventually sold
- How new family members can be added as beneficiaries
The Property Tax Angle
Maryland offers several property tax benefits that affect estate planning decisions:
- Homestead tax credit caps annual increases in assessed value for owner-occupied homes
- Senior property tax credits reduce taxes for owners 65 and older who meet income thresholds
- Disabled veteran property tax exemptions
- Agricultural use assessments for qualifying farm properties
Transfers of ownership can affect these benefits. Some transfers (to a revocable trust, for example) generally do not affect the homestead credit. Others can trigger reassessment or loss of benefits. Understanding the specific impact before making a transfer is important.
Multiple Heirs and the Operational Problem
When a home is left to multiple children without clear instructions, the result is often frustration and, at times, litigation. Common problems include:
- One sibling wants to keep and use the home; another wants to sell
- Disputes over who pays for maintenance, insurance, and property taxes
- One sibling lives in the home rent-free, while others feel disadvantaged
- Disagreements about necessary repairs or improvements
- Inability to reach a consensus on the listing price if the home is eventually sold
Trust structures can address these issues with clear rules. Buyout provisions, forced-sale triggers, and dispute-resolution procedures can all be incorporated into the trust document.
For the broader context of how the home fits into your overall Maryland estate plan, see our full guide: Calvert County Estates and Probate: A Complete Guide.
Coordinating with Your Will
A TODD or trust that handles the home should be coordinated with the rest of your estate plan. A will that says “I leave my home to Sarah” conflicts with a TODD that names Michael. The TODD controls the real estate, but the conflict can create confusion and potential litigation. Every planning tool needs to work together as a coherent whole.
First step: Pull out your current deed. Check whose name is on it. Look at how the ownership is described (sole, joint with right of survivorship, tenancy in common). That starting point tells us what planning options make sense for your situation.
Keeping the Family Home in Owings?
We help Owings families choose the right tools to pass the family home to the next generation. Free consultation.
This article is for general information only and does not constitute legal advice. Contacting our firm does not create an attorney-client relationship until a formal agreement is signed.
