A Florida Enhanced Life Estate is sometimes called a “Ladybird Deed”.
What is a Ladybird Quitclaim Deed?
An enhanced life estate is a form of interest in real property that the grantee “may” take.
What is an Enhanced Life Estate?
When it is not limited by the need for the remainderman’s consent.
When does a Life Estate become “enhanced”?
Life estates cannot be easily changed. The Enhanced Life Estate allows the life tenant to remain in control until they pass. This deed is used to automatically transfer ownership of a property to another person (s) upon the owner’s death without the need for probate.
What is the difference between a Florida Life Estate and an Enhanced Life Estate?
Because the Ladybird is different from the Florida Life Estate a house is able to be transferred directly to the beneficiaries by operation of law.
How do you avoid probate with a Ladybird Quitclaim deed?
- You remain the owner of the property and can change the deed or sell your property without the permission of your child. - The property is not subject to the claims of your child’s creditors or the claims of a divorcing spouse. - At your death, the property passes to your child automatically without probate or expenses or delays. - You are able to avoid the Federal gift tax because the ladybird transfer is an incomplete gift. - You can preserve homestead benefits - You can preserve Medicaid eligibility - It is a step-up in basis at your death
What are the benefits of a Ladybird Quitclaim deed?
Make sure that if your beneficiaries are your children, that they are not minors. If your beneficiaries are recipients of Medicaid or other governmental benefits, then the inheritance may affect their rights. If you are listing multiple beneficiaries make sure they all get along. There is also a limitation if the beneficiary passes away before you do. Lastly, there is a limitation of Homestead.
What are the limitations of the use of a Florida Ladybird Quitclaim deed?
A Ladybird Deed becomes effective immediately upon its recording in the county land records. The transfer to the remainderman does not become effective until the occurrence of the tenant’s death.
When does the Ladybird Quitclaim Deed take effect?
Since the Ladybird Deed is not taken into effect until after the grantor’s death, the property is not considered to have been transferred for the purpose of the 60-month lookback period.
When does the Ladybird Quitclaim Deed have to be recorded?