Section 1 Transfer-on-death (TOD) of title to motor vehicle.

Subdivision 1 allows a TOD beneficiary designation to be entered on a motor vehicle certificate of title.  This designation is subject to rights of secured parties.

Subdivision 2 specifies the information that must be included on the title certificate to accomplish registration in TOD form. The title transfer need not be supported by consideration, and the title does not need to be delivered to the beneficiary.

Subdivision 3 provides that a TOD beneficiary has no interest in the motor vehicle until the death of the owner.  The owner or joint owners with rights of survivorship may change the TOD designation without the beneficiary’s consent by applying for a new certificate of title.

Subdivision 4 provides that motor vehicle ownership vests in a TOD beneficiary upon the death of the owner or the last surviving joint owner, subject to the rights of secured parties.  The TOD beneficiary may obtain a new certificate of title upon providing proof of the death of the transferor.  If no TOD beneficiaries survive the transferor, the motor vehicle is included in the probate estate of the deceased owner.  A TOD transfer is not a testamentary transfer.

Subdivision 5 states that this section does not limit the rights of secured parties or creditors of the owner against a TOD beneficiary.

Section 2 amends the sales tax exemption for acquisition of a motor vehicle by inheritance or bequest to include transfer-on-death of title.

BB/KB/KP:rer/gc