Lady Bird Deeds have gained prominence as a valuable tool for property transfer and asset protection, particularly in states like Florida where people often keep second homes or vacation properties for the winter.
Also known as an “enhanced life estate deed,” a Lady Bird Deed offers unique advantages for homeowners looking to secure their property and simplify the transfer of assets to their heirs.
How do Lady Bird deeds work?
A Lady Bird deed is a type of deed that enables property owners to designate beneficiaries to inherit the property immediately upon their death.
Unlike adding another person to a deed directly (which makes them a co-owner), a Lady Bird Deed allows the original property owner and grantor to maintain the right to use, sell or mortgage their property at any point during their lifetime – without interference from the designated beneficiaries. Not all states recognize Lady Bird Deeds, but Florida does.
The advantages of an enhanced life estate deed include:
- Probate avoidance: Your property will pass directly to the person or persons you designate, bypassing probate entirely. That prevents a lot of hassles and can also avoid significant estate disputes.
- Control and flexibility: You don’t have to worry about losing control of your property during your lifetime. If you decide to make changes, you have that right – which is not possible if you put the home in an irrevocable trust or put your chosen beneficiary on the deed as a co-owner.
- Medicaid planning: Lady Bird deeds can be used as part of Medicaid planning strategies, in conjunction with other asset-protection measures.
There’s no one “perfect” estate planning strategy for everyone, but a Lady Bird deed is something to consider. Legal guidance can help you decide what’s best for your needs.
