Multi-State Properties? How Does That Impact Your Heirs? (4 min read)
Do you own a vacation home, rental property, or spend winters in one state and summers in another? Owning property in more than one state is wonderful for you—but it can create nightmares for your heirs if you don’t plan ahead. The good news? A few smart steps now can save them months of court delays and thousands of dollars later.
Let’s take a look at how you can make a transfer of ownership easier on others.
Why Multiple States = Multiple Probate Headaches
When you pass away, your home state probate court will handle most of your estate. But every other state where you own real estate may also require probate in their state. The legal term for this is called ancillary probate.
Two properties in two states? That means two courts, two sets of legal and court fees, and a whole lot of waiting.
What is a "Home State"?
For legal and tax purposes, you can only have one home state. This is the place you consider to be your permanent residence. How is this determined? It’s generally based on the following:
It’s where you live most of the time
It’s where you intend to return to if you’re away
It’s where you vote, file taxes, and hold a driver’s license
Why Does This Matter?
Probate: Your heirs may face probate court in each state where you own real estate.
Taxes: Your home state taxes you on worldwide income, but other states may tax income or capital gains from property physically located there.
Estate Planning: Knowing which is your legal home state helps determine which state’s estate laws apply to your will, trust, or transfer-on-death deeds.
Do All States View This the Same Way?
Not exactly. The general concept is similar everywhere, but states can have different rules for determining the home state, especially if you split your time between two places. For example:
Florida vs. New York: Both use factors like where you vote and where your car is registered, but Florida also heavily considers where you declare your homestead exemption (since it has no state income tax, people sometimes try to claim Florida as their home state for tax savings).
Community property states (like California, Arizona, Texas, Washington) consider property acquired during marriage to belong equally to both spouses. If you and your spouse jointly own a second property in one of these states, the survivor might automatically get full ownership at your death—no probate required.
Non-community property states (like Oregon, New York, Florida) generally divide ownership based on whose name is on the title. A property in just your name? Straight to probate when you die.
So, if you live in a non-community property state but own a vacation home in a community property state, the rules may work for you or against you depending on how the deed is titled. Another reason why a little planning now can make a huge difference later.
What Are the Best Options To Avoid Probate?
Revocable Living Trust – One trust can cover properties in every state.
Transfer-on-Death (TOD) or Beneficiary Deeds – A quick fix (if your state allows it) to automatically transfer property without probate, but more limiting than a trust.
Quick note: TOD deeds can be great for simple situations, but they come with limits. For example, your heir can’t always sell right away due to creditor claim periods (up to 18 months in some states), and they’ll need to cover all property taxes and maintenance during that time. To learn more about this and other important considerations, check out my separate blog that provides more details.
Joint Ownership with Right of Survivorship – Works in some cases but can create tax or inheritance issues if not set up correctly.
LLC for Investment Properties – More common for rentals, but it can also streamline transfers.
Let’s Take A Look At A Sample Scenario: Linda lived in Oregon but owned a beach condo in California. She had a will, so her kids assumed everything would be simple after she passed. It wasn’t.
Oregon probate took over a year, and because she didn’t transfer the California condo into a trust or use a transfer-on-death deed, her kids had to open a second probate in California.
That added six more months of delays and several thousand dollars in extra attorney fees—just to sell the condo. Knowing her options for better planning could have avoided the whole mess.
A Better Outcome: Compare that with George and Nancy, who owned property in Oregon and Washington. They used properly prepared TOD deeds for both properties, naming their daughter as the beneficiary.
After they passed, she filed the deeds with each county, avoided probate completely, and, because she planned to keep the properties, the 12–18 month creditor claim period didn’t affect her. She saved thousands in legal fees and a lot of frustration.
The Bottom Line
If you own property in more than one state, plan ahead now so you have time to make the best decision on which option (or options) will work best for your situation.
The key takeaway? Don’t assume your will alone is enough.
Next Steps for You
1. Make a list of all properties you own and which state they’re in.
2. Find out if your state allows TOD deeds (and how long the creditor claim period lasts).
3. Double‑check your property titles, especially if you’re married and own in a community property state.
4. Talk to an estate planning attorney to make sure the strategy you choose really works for your situation.
Planning now will save your family stress, money, and maybe a couple of years of waiting on multiple courts. If you own property in more than one state, talk to an estate planning attorney soon—it’s one of the smartest gifts you can leave your loved ones.