Tax Law Center Blog

New Jersey motor vehicle owners can now simplify the transfer of their vehicle upon their death by designating a transfer on death (TOD) beneficiary. This new law change allows vehicles to bypass the often lengthy and complex probate process for vehicles.

Why is this important?

• Faster Transfer: The designated beneficiary receives the vehicle quicker without waiting for the appointment of an executor or administrator.
• Reduced Probate: The vehicle doesn’t become tied up in the estate, preventing it from sitting unused for extended periods.

How does it work?

1. Download the Form: Obtain the NJ motor vehicle TOD form from the NJ MVC website.
2. Complete and Notarize: Fill out the form, sign it, and have it notarized.
3. Safekeeping: Keep the form in a secure location until needed; consider keeping with your estate plan documents.
4. After Death: The beneficiary presents the form, along with the title, death certificate, and a universal title application, to the NJ DMV to transfer ownership.

Important Considerations:

• Vehicle Types: The TOD form applies to various vehicles like cars, motorcycles, campers, and trucks. However, it’s not applicable to vehicles owned by entities like corporations.
• Inheritance Tax: While the TOD process avoids probate, it may not eliminate potential inheritance tax implications, depending on the beneficiary’s relationship to the deceased.

In Conclusion:

Designating a TOD beneficiary is a valuable tool for NJ motor vehicle owners to streamline the transfer of their vehicle upon death. Consulting with a trust and estate attorney can help you understand the broader implications of this and other estate planning strategies.