Sometimes referred to as the Ladybird Deed, an Enhanced Life Estate Deed is a method of transferring real estate without probate. Upon the owner’s death, the property passes to the beneficiary named in the deed through operation of law, which means it does not invoke probate.
An Enhanced Life Estate Deed differs from the typical life estate deed as the property is transferred at death, not before. This means the owner or “life tenant” retains complete control over their property while alive. The life tenant can sell, mortgage, and profit off of their property without having to consult the beneficiary.
The benefits of Enhanced Life Estate Deeds include:
- Medicaid eligibility is not affected by an Enhanced Life Estate Deed because you still retain ownership of the property. Likewise, because you own the property you avoid Medicaid’s look-back rule.
- Medicaid’s right to estate recovery is diminished because in some cases, only properties that were exchanged with probate qualify to repay Medicaid expenses. This means the beneficiaries will not be at risk of having to sell the property to repay the expenses.
- The gift task is also avoided as the property is given in death, not life.
Understanding Enhanced Life Estate Deeds and how they work in your state can be a difficult process. For assistance and answers in establishing your Enhanced Life Estate Deed, contact us today.