People have several options to transfer a vehicle.
Vehicles can tend to be one of the higher-valued assets people own.
This is true whether they have significant monetary value, such as with a Ferrari, or simply hold value as a means to get from point A to point B.
Whether your motorized vehicle is a car, motorcycle, or RV, you cannot take it with you when you die.
According to a recent Yahoo Finance article titled “What Happens If the Executor of My Will Dies?,” vehicles require special attention in your estate planning.
First, it is important to note who currently owns the vehicle.
Is it owned solely by you?
Do you share ownership with another person or multiple people?
If you are unsure, check out the names on the title face itself.
If another person is listed on the title, the vehicle will pass to this person at your death.
When this happens, the remaining owner can retitle the asset under their name without any need for involvement from the executor.
When the vehicle is titled as joint tenancy, all living owners must approve an ownership transfer and sign the appropriate paperwork to transfer a vehicle.
If you are uncertain whether the property is owned via joint tenancy, review the title to see if two or more owners are listed and joined by the word “AND,” OR,” or “AND/OR.”
These designate survivorship rights in most states.
If you retain sole ownership, you will need to decide who would inherit your vehicle.
Once you have identified who you want to inherit the vehicle, you must arrange for a title change.
You really have three options:
- You can add the inheritor to the title as a joint owner while you are still alive;
- If you have a revocable living trust, then you can title the vehicle to the trust and provide in the trust for distribution of the vehicle to the inheritor; or
- If your state permits it, you may designate right on the title itself that the vehicle is to transfer-on-death to the inheritor.
Absent exercising one of these three options, then the vehicle will likely enter probate.
The title will likely not be changed until probate has been completed.
Certain documents are typically necessary to transfer a vehicle after death.
These include the original title, a copy of the death certificate of the original owner, and the document the probate court issues to allow the transfer.
Although these are general guidelines, states have varying probate laws.
For example, suppose the sum of the assets subject to probate is not more than $40,000, and no real estate is subject to probate. In that case, both Kansas and Missouri provide for a streamlined small estate affidavit process to avoid opening probate.
This is how many orphaned vehicles (i.e., without a surviving owner) are transferred here in the heartland.
To ensure you meet your state’s requirements, review your state’s probate laws and contact the Department of Motor Vehicles to confirm how to transfer a vehicle as part of your estate plan.
Reference: Yahoo Finance (May 15, 2023) “What Happens If the Executor of My Will Dies?”