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An enhanced life estate deed, also called a Lady Bird deed, is a legal document that allows one to transfer property to their heirs upon their death while still maintaining legal ownership over the property while alive. In a regular life estate deed, the client that transfers property to his or her beneficiaries does not have the right to sell that property during the rest of his or her lifetime. In addition, a regular life estate deed can leave the client liable if he or she decreased the value of the property while living. It can also disqualify the client from being eligible for Medicaid.
However, an enhanced life estate deed will still easily transfer the client's property to his or her named heirs, but while still living, that client has the right to sell or mortgage their property, use profits made by the property, avoid federal gift taxes, avoid probate if the property does pass to the beneficiaries, and still allows the client to be eligible for Medicaid while living. In addition, with an enhanced life estate deed, if the client received Medicaid while living, the state will not be able to make a claim on the transferred property after death since the property will not go through probate.
Enhanced life estate deeds are typically an easy and inexpensive way for clients to transfer their property after death to their legally named heirs without probate and without giving up the rights to control the property while still alive. However, if an enhanced life estate deed is filled out incorrectly in the slightest of ways, it can mean the property will still go through probate and the other benefits of the deed may not be valid. In addition, enhanced life estate deeds are not used in every state and there may be other options that suit a given situation better than an enhanced life estate deed would.
It is important to talk to a qualified attorney if you are considering using an enhanced life estate deed. An estate planning attorney can give you the correct details about using an enhanced life estate deed in your home state, and will discuss all options available to you. An enhanced life estate deed can affect your property's taxes, valuation, and your own ability to control the property and to receive Medicaid benefits, a lawyer's help navigating these complexities can be essential in planning for your property transfer.
If you think an Enhanced Life Estate Deed may be right for you, speak to an estate planning lawyer in your area today. Attorney Search Network can provide you with an estate planning lawyer referral that can help you achieve your goals.
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