Colorado Now Allows “Beneficiary Title” to Motor Vehicles
In 2016, Colorado law changed to allow anyone owning a car registered in the state to name a beneficiary to receive that car without having to go through probate. This can make estate planning for modest estates even easier. But experts warn that other commonly used nonprobate transfer estate-planning tools can cause confusion and legal disputes over the legitimacy of the beneficiary title. It’s best to work with a knowledgeable and experienced attorney in the use of the DR 2009 form for naming a beneficiary title to a motor vehicle.
This is similar to the beneficiary deed for real estate that Colorado has had in place for some time. The vehicle owner must complete Department of Revenue Form DR2009 and keep it with their estate planning documents. Then, upon the death of the vehicle owner, the beneficiary presents the form with a death certificate and the title will transfer to the beneficiary after paying the appropriate transfer fees.
Revoking the form can be done by selling the vehicle (beneficiary approval not needed) or completing a new form. It’s odd, though, that you can’t revoke the form by destroying it, such as you can with a Last Will and Testament.
In the past, estates where the only probate asset was a vehicle could usually transfer ownership by way of a Colorado small estate affidavit without having to use the full probate process. Use of that affidavit could sometimes prove difficult, though, if the estate was payable to multiple persons or there were creditors that had to be paid from the small estate assets. Any lien on the vehicle would still have to be paid, of course, even using this new beneficiary form.
A word of warning, though. This form will supersede anything in your Last Will and Testament. So if you decide to do a new Will, you should review this form along with any other beneficiary designations you may have on record.
If you need help, please reach out to our firm, the Law Office of Colorado Estate Planning Law Center, today by calling our office or or email us. We are ready to help with your Colorado estate and business planning needs.
Sources:
The Gazette, “New state form for vehicle transfer on death is simple, but estate advice still recommended“, by Jim Flynn, accessed on June 8, 2019.
Avvo, “Colorado Beneficiary Deed“, accessed on March 22, 2017.
Colorado Department of Revenue, “State of Colorado Transfer of Title Upon Death Designated Beneficiary Form, C.R.S. 42-6-110.5“, accessed on March 22, 2017.
