Couple Takes Advantage of Unique Way to Give
Cody and Joycelyn Christman enjoy their Montana cabin getaway. Living in the hustle of Denver and their busy careers, the Christmans relish time spent in the Montana quiet, close to where Cody ('91, Electrical Engineering) grew up. Recently, they have wondered what will happen to the property when they die. During a meeting with their estate planning attorney, they learned that if they pass the property through their Colorado will, it will require that a separate probate action be opened in Montana. Since the majority of their estate will be probated in Colorado, the Christmans understandably wanted to avoid a second probate and its associated costs.
Cody asked around and eventually visited with one of his fraternity brothers from MSU. The friend suggested that Cody look into beneficiary deeds. With some research, Cody learned that for people who live out of state but have property in Montana, beneficiary deeds are a simple, cost effective way to transfer their property. For the filing fee that is usually less than $10, the current owner assigns the property deed to a beneficiary. The beneficiary will receive full ownership rights upon the death of the current owner. The property never passes through the current owner's estate, nor does the beneficiary bear any cost of ownership while the current owner is alive. Beneficiary deeds are allowed in just half of the states in the U.S. and have only been an option in Montana since 2007. They are becoming more popular for out-of-staters and for Montana residents who wish to avoid probate costs.
Since Cody always intended to name Montana State in his will, this property became an ideal asset to gift. The fact that the beneficiary deed is revocable was attractive to the Christmans; they figured that there was no permanent action or harm done by filing it. If they change their mind in the future, they can revoke the current beneficiary deed or file a new beneficiary deed that names a new beneficiary.
After learning about beneficiary deeds, the Christmans turned to the Montana State University Alumni Foundation for help. The beneficiary deed process was relatively simple, compared to writing a will and going through probate.
Because a beneficiary deed has been properly filed, MSU will gain full title to the property when Cody and Joycelyn pass away. The Foundation's policy is to sell the property and use the proceeds for the purpose that the Christmans intended—student support in Electrical Engineering and Dietetics, as well as scholarships for Cody's fraternity, Pi Kappa Alpha.
For Cody, who is a founding member of MSU's Denver Alumni Chapter and very proud of his MSU engineering education, a beneficiary deed accomplishes two things: supporting a charity that he and Joycelyn believe in and solving a major problem in their estate plan.
The information on this website is not intended as legal or tax advice. For such advice, please consult an attorney or tax advisor. Figures cited in examples are for hypothetical purposes only and are subject to change. References to estate and income taxes include federal taxes only. State income/estate taxes or state law may impact your results. Annuities are subject to regulation by the State of California. Payments under such agreements, however, are not protected or otherwise guaranteed by any government agency or the California Life and Health Insurance Guarantee Association. A charitable gift annuity is not regulated by the Oklahoma Insurance Department and is not protected by a guaranty association affiliated with the Oklahoma Insurance Department. Charitable gift annuities are not regulated by and are not under the jurisdiction of the South Dakota Division of Insurance.