MSU Extension: Using a Beneficiary Designation to Transfer a Montana Vehicle or Vessel Title at Death

This is one of a series of articles focusing on estate and legacy planning.

“The 2021 Montana Legislature passed the Transfer on Death Act for Vehicles and Vessels and clarified the definition of vehicles and vessels during the 2023 session” says Marsha Goetting, MSU Extension Family Economics Specialist.

Montana law defines vehicles and vessels to include automobiles, vans, trucks, sport utility vehicles, motorcycles, recreational vehicles, trailers, pole trailers, snowmobiles, sailboats 12 feet or longer, and motorized boats including personal watercraft. Mobile homes and house trailers have not been titled since January 1, 2006.

If a manufactured home is permanently attached or built on a town lot or other land the owner owns, title to the real property can be transferred at the owner’s death without probate by using a Transfer on Death Deed (formerly called a Beneficiary Deed). Visit https://bit.ly/4dqhz64 for more info.

“The definition of a vehicle or vessel also includes any other items for which a certificate of title is issued by the motor vehicle department. An airplane is not considered a vehicle or vessel in Montana,” said Goetting.

If more than one person owns a vehicle or vessel, by state law the vehicle or vessel is titled as joint tenants with right of survivorship (JTWROS). When one joint tenant dies, the surviving joint tenant(s) become owner(s) by operation of state law. The surviving joint tenant(s) may apply for the title in the survivor’s name(s) and may add up to two beneficiaries when applying for the title using Form MV13.

“Keep in mind if two owners name a beneficiary, and one owner dies, the surviving joint tenant could change the beneficiary designation and undo the intention of the first-to-die joint owner,” cautions Miller. As an example, Isaac and Brenda are a blended family, each with a child of driving age from an earlier marriage. Isaac and Brenda own two vehicles titled in both of their names as JTWROS. During an estate planning discussion, Isaac shared with Brenda that he wants his son to inherit his vehicle when he dies. Similarly, Brenda wants her daughter to receive hers after death.

“Upon Isaac’s death, Brenda is the sole owner of Isaac’s vehicle under Montana law because the title is held in JTWROS between Isaac and Brenda. Even if Isaac had filed the MV13 form naming his son as the beneficiary, the vehicle title would pass to Brenda because she is the surviving joint tenant,” emphasizes Goetting.

Brenda is now the owner of both her vehicle and Isaac’s. She can name whomever she wants as the beneficiary(s) of each vehicle on a separate MV13 form.

Assume she names her daughter as the beneficiary of both vehicles. When Brenda dies, both transfer to her daughter. Isaac’s son does not receive the vehicle his dad wanted him to have. Another example: Assume Isaac has the vehicle titled in joint tenancy with right of survivorship (JTWROS) between himself and Brenda. Later Isaac wrote a will naming his son to inherit the vehicle. Because of the joint tenancy, Brenda receives it, not Isaac’s son. “A written will cannot undo a JTWROS on any type of property (including checking and savings accounts; stocks, bonds, and mutual funds; and real property),” said Miller.

This time let’s assume Isaac has the vehicle in his name only (sole ownership) instead of JTWROS with Brenda. Isaac filed form MV13 naming his son as the beneficiary. Upon Isaac’s death, the title to the vehicle transfers to his son because Issac completed a beneficiary designation for his solely owned vehicle.

Important To Do!!! The owner and beneficiaries should contact their insurance companies to ensure the vehicle or vessel is insured at and after the death of the owner.

More information is available at https://bit.ly/3LZXW8N in a brand new MSU Extension MontGuide, Using a Beneficiary Designation tr Transfer a Montana Vehicle or Vessel Title at Death.

For those who do not have computer access, copies of all MontGuides mentioned in this article are available from the Madison-Jefferson County Extension office at 406-287-3282.