[IL] When completing a TOD instrument, should I name a trust as the beneficiary or list the co-owners for a share of property?

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Thank you so much for chatting with me on this. On the TODI form, your sister should name her trust as the beneficiary, not you and your other sister personally. The purpose of the TODI is to transfer her share of the farm into the trust at death, and the trust is the correct recipient. The trust document itself will then control what happens to her share after that. Since you confirmed the trust is already set up to receive her farm interest, naming the trust on the TODI is consistent with her overall estate plan. (755 ILCS 27/10)

The Illinois Residential Real Property Transfer on Death Instrument Act governs TODIs in Illinois. A TODI must identify the beneficiary with enough specificity to complete the transfer. Naming the trust by its full legal name satisfies this requirement. (755 ILCS 27/40)

When completing the form, use the trust's exact legal name as it appears in the trust document, for example, "The [Sister's Name] Revocable Living Trust dated [date]." This prevents ambiguity when the deed is recorded after her death. The TODI must be signed, notarized, and recorded with the McLean County Recorder of Deeds before your sister's death to be valid. An unrecorded TODI has no effect.

Because she has been diagnosed with vascular dementia, timing matters. The TODI must be executed while she still has legal capacity. If capacity becomes an issue later, the instrument could be challenged. (755 ILCS 27/15)

Your sister should not need to involve you or your other sister to execute the TODI. It is her separate act as a co-owner of her undivided interest in the farm.

The bank manages the farm, but recording the TODI with the county recorder is what legally secures the transfer. Notify the bank after the TODI is recorded so they have it in their file.

Does that help clarify things? I want to make sure I didn’t leave anything out.

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I am one of three sisters who own a farm in Illinois. The eldest sister has been diagnosed with vascular dementia, and she has been advised to submit a TODI instrument, which will place her share of the farm into her.

Lexi, Chatbot

I'm sorry to hear about your sister's diagnosis; that must be a difficult situation for your family. Can you tell me if there are any existing estate planning documents in place for the farm?

I meant to say that she wants her share to go into her trust at the time of her death. She has a will and trust document, and my other sister and I have wills.

Lexi, Chatbot

Have you and your other sister discussed how this situation might affect the management and ownership of the farm moving forward?

Our farm is managed by a Bank and Trust in Bloomington, IL.

Legal Eagle

Hello, I'm Legal Eagle. I'm an attorney who works in your area of law and I'll help you sort this out today. I've read what you shared, so let's go over what's happening and what your best next steps look like. Is your sister's trust set up to automatically receive her share of the farm, or are there additional steps needed to ensure this transfer?

The trust is set up to receive her shares.

Legal Eagle

Got it, thanks for letting me know. Are there any concerns or issues with the current setup, or is there a specific aspect of the transfer process you're seeking advice on?

I just need to know how to fill out the TODI form. Do I identify my other sister and me as the beneficiaries or just identify the trust as her beneficiary?

Legal Eagle

Ok! I've been working on an answer while we've been chatting, so it'll just be a moment.

I have the property description and the parcel number. Do I need to submit a copy of the deed?

Legal Eagle

Your sister should not need to involve you or your other sister to execute the TODI. It is her separate act as a co-owner of her undivided interest in the farm.

The bank manages the farm, but recording the TODI with the county recorder is what legally secures the transfer. Notify the bank after the TODI is recorded so they have it in their file.

Does that help clarify things? I want to make sure I didn’t leave anything out.

Bravo! You have been a HUGE help to the family!!!!! THANK YOU.

Legal Eagle

For sure! Did I thoroughly address your question? Did I provide top-tier service to you? If the answer is no to either, please let me know so I can help! I know it's a lot.

Legal Eagle

I hope I was able to help resolve your issue! If you have any other questions, feel free to ask.

Legal Eagle

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