A quit claim deed contains no warranties; it states only that "whatever"
ownership interests the transferor may have in the property are being
relinquished to the transferee. Regardless of the type of deed, the ownership
interests being transferred take effect upon the delivery of the deed to the
transferee, and delivery can be made at any time during the lifetime of the
transferor, or by an escrow agent upon the transferor's death.
Another type of non-probate property can be found in contracts which
provide for the naming of beneficiaries. Common examples of property
passing by contract are life insurance, annuities, and retirement benefits
(IRA's, SEP's, profit-sharing plans, 401(k) plans, etc.). Because the
successor(s) in interest are already spelled-out as essential terms of these
contracts, the probate court does not have to supervise "who gets what" and
"how much" to each recipient. But consider the result of naming yourself or
your estate as the sole beneficiary on any one of these contracts: either
nomination effectively brings the property back into the probate estate, just as
if the contract did not contain a beneficiary provision or if no beneficiary were
named at all! An even worse consequence occurs in Ohio where life insurance
proceeds are left to one's estate: the value of such a life insurance policy then
becomes subject to estate tax, where otherwise it well may not have been
taxable. If you are not sure whom to name as a beneficiary on one of these
types of contracts, then you can establish a trust to receive the proceeds. In
this situation, the trust set up is usually a "revocable" one, which means that
its terms can be amended from time to time, or it can be terminated all together
during the grantor's lifetime. Another advantage here is that the trustee can be
authorized to use discretion in distributing the proceeds, and this feature
provides even more flexibility in your estate plan.
In summary, deeds and contracts can be used very creatively to transfer
the ownership of property in non-probate form, whether in a trust situation or
independently. In fact, any property, whether real or personal, may be the
subject of a deed or contract -- so long as the property is described well
enough to be identifiable. All or any part of an ownership interest in the
specified property may be transferred. Moreover, with certain exceptions,
these transfers can be outright, or conditional, or for a period of time, or for
only a limited and specific use -- whatever the transferor desires.
