Complete Guide to the Florida Lady Bird Deed
What is a Florida lady bird deed?
A lady bird deed transfers property for estate planning purposes while letting you keep complete control over the property during your life. The lady bird deed lets you (1) revoke the transfer if you change your mind later, (2) avoid probate, (3) keep your Florida homestead exemption, and (4) maintain Medicaid eligibility. The lady bird deed is also called an “enhanced life estate deed” and occasionally a “lady bird trust.”
A lady bird deed is also called an “enhanced life estate deed” because it really is just a life estate deed with more control. So to understand what a lady bird deed is and why you might want one, we first need to talk about a traditional life estate deed. A life estate deed lets you give away ownership of your property after you die, but it also lets you keep the ability to use your property for as long as you are alive. The property interest you keep during your life is called a “life estate,” and the property interest you give away is called a “remainder.” After you die, the person with the remainder becomes the full owner of the property.
The big advantage of a traditional life estate deed is that it avoids probate. The remainder beneficiary does not have to wait for a court to approve the transfer after death; rather, the whole transfer is automatic. This makes life estate deeds incredibly useful for estate planning. When properly utilized, a life estate deed can make things easier for your loved ones after you pass. However, there is also a big downside to a traditional life estate deed: you lose the ability to sell your property unless the remainder beneficiary agrees to the sale. You could theoretically sell your life estate interest, but in practicality this almost never happens. Simply put, you are no longer the sole owner of the property! This huge downside is why many people opt instead for a lady bird deed.
Another reason the lady bird deed is sometimes called an“enhanced life estate deed” is that it solves the big problem of life estate deeds. The enhancement is that the person keeping the life estate also retains the right to transfer the property without the involvement of the remainder beneficiary. In other words, you can still sell or convey the property without the approval of the remainder beneficiary. The lady bird deed accomplishes this by not allowing the remainder beneficiary’s title to vest until the death of the grantor. Simply put, you keep complete control over the property while also getting all the estate planning advantages of a life estate deed.
Does a lady bird deed avoid probate in Florida?
Yes, a lady bird deed will let you avoid the probate court in Florida. When you pass away, your interest in the property disappears and the person listed as a beneficiary on the deed gains full ownership of the property, outside of the probate code.
As noted above, the Florida lady bird deed is actually a type of life estate deed. Thus, the grantor keeps a life estate in the property and only gives away a future interest in the property. The person who receives that future interest in the property is called a “remainderman” (or a “remainder beneficiary”). If the grantor never sells the property, then upon the grantor’s death the remainderman automatically owns the entire property. Because the transfer was agreed to in the deed, the transfer takes place automatically without the need for a probate court to get involved.
Avoiding probate also allows the property to pass without involvement from the personal representative of the estate. This can alleviate a lot of frustration on the part of the beneficiary of the property. It can also save money, as probate can be a costly process.
However, if your main goal in using a lady bird deed is to avoid probate, you should take steps to ensure that the deed is drafted properly. Incorrect drafting can cause many problems. For example, the deed should contemplate what will happen if the remainderman dies before the grantor. Without proper planning, this occurrence could result in the property still needing to be probated.
Does Florida allow lady bird deeds?
Yes, Florida is one of only five states that allow lady bird deeds.
Although lady bird deeds are not recognized in the Florida Statutes, the Florida Supreme Court held in 1917 that these deeds are permissible in Florida. Additionally, in the ACCESS Florida Program Policy Manual, which explains the Florida Department of Children and Families’ interpretation of statutes and regulations, lady bird deeds are recognized as valid. Furthermore, lady bird deeds are recorded all the time by the clerks of court in Florida. Thus, lady bird deeds are allowed and enforceable in Florida.
What are the pros and cons of using a lady bird deed in Florida?
The advantages of using a lady bird deed in Florida include:
Avoiding Probate: One significant advantage of using a lady bird deed is that it allows the transfer of property to designated beneficiaries without the need for probate. This can save time and money for the beneficiaries and expedite the transfer of ownership.
Retaining Control and Use: With a lady bird deed, the grantor retains control and use of the property during their lifetime. They can sell, mortgage, or revoke the deed without the consent of the beneficiaries, providing flexibility and control over the property.
Potential Medicaid Planning: In Florida, a lady bird deed is generally considered an exempt transfer for Medicaid eligibility purposes. It may help preserve the grantor's eligibility for Medicaid benefits while allowing the transfer of property to beneficiaries.
Step-Up in Tax Basis: When the grantor passes away and the property transfers to the beneficiaries, it typically receives a step-up in tax basis. This can result in potential tax benefits for the beneficiaries if they decide to sell the property in the future.
The disadvantages of using a lady bird deed include:
Less Flexible than a Trust: Although the lady bird deed provides greater flexibility than the traditional life estate deed, the lady bird deed provides less flexibility than a living revocable trust. For example, the lady bird deed cannot hold property for a person until they reach a certain age or milestone. However, a living trust could handle this without any problem.
Lack of Familiarity: Not everyone is familiar with lady bird deeds, including some title insurance and mortgage companies. Depending on the company you go through, a lady bird deed could make refinancing your property more difficult than it would be if the property had simply been held in a living trust. That being said, many major title insurance and mortgage companies—especially Florida-based companies—are very familiar with lady bird deeds and will have no problem working with such a deed.
Creditors and the IRS: If the remainder beneficiary of a lady bird deed has a creditor seeking repayment of an outstanding debt, that creditor could potentially attach a lien to the remainder interest. This is also potentially true of tax liens. However, there is some legal uncertainty about whether private creditors could attach a lien to the remainder interest.
Possible Refinancing Difficulties: Banks are sometimes reluctant to refinance or mortgage property in which the owner has executed a lady bird deed. There is no solid legal footing for this reluctance, but that does not change the practical problem of having a difficult time getting a loan. The solution to this problem is often to revoke the lady bird deed before mortgaging property.
What happens with a lady bird deed after death?
When the owner of the property (grantor) passes away, the property automatically transfers to the designated beneficiaries listed on the deed. This transfer occurs without any probate of the property. This means that the beneficiaries named in the lady bird deed become the new owners of the property without the need for a court process (i.e., probate).
To ensure a smooth transition of the property after the grantor's death, it is generally advisable for the beneficiaries to record a short form death certificate with the appropriate clerk of court.
What states recognize lady bird deeds?
Lady bird deeds are recognized in only five states: Florida, Michigan, Texas, Vermont, and West Virginia. However, many other states use a transfer on death or beneficiary deed, which is similar to the lady bird deed.
Should I put my home in my will if I use a lady bird deed?
No, you do not need to include your home in your will if you have used a lady bird deed. The lady bird deed transfers your property outside of the probate code. Thus, the lady bird deed will take effect with or without a mention in your will.
However, if you revoke the lady bird deed, then you may need to mention your home in your will. Thus, a good estate planning attorney will ensure your will contains a clause disposing of the homestead as a backup, just in case the deed is revoked.
Who signs a lady bird deed?
A lady bird needs to be signed by the grantor (typically, the owner of the property), two witnesses, and a notary. In some cases, the grantor’s spouse may also need to sign the deed.
Is a lady bird deed the same thing as a transfer on death deed?
No, a lady bird deed and a transfer on death deed (sometimes abbreviated as “TOD deed”) are not the same thing, although they share some similarities in their purpose of transferring property upon the owner’s death.
The main distinction between the two lies in the name given and the source of legal authority. Transfer on death deeds are typically statutory, meaning the legislature of a state wrote into law that the deeds are valid. Lady bird deeds are typically a creation of case law. For example, in Florida, the lady bird deed was created by a Florida Supreme Court case.
Does a lady bird deed have to be recorded?
Although technically not required, it is highly recommended to record a lady bird deed to ensure its validity and to provide a clear public record of the property transfer. Recording the lady bird deed with the appropriate county’s official records office serves as notice to any interested parties about the transfer of ownership rights and helps establish the beneficiaries’ rights to the property.
Recording the lady bird deed provides several benefits:
Establishing Priority: Recording the deed establishes a priority date for the transfer of the property. It helps determine the order of ownership and protects the rights of the beneficiaries against any subsequent claims or conflicting interests.
Presumption of Delivery: Recording the deed creates a presumption that the deed was delivered, which is a requirement for proper deed execution in Florida. Absent this presumption, the deed would be easier to challenge in litigation.
Clarity and Protection: Recording the deed creates an official record of the transfer that can be easily referenced and verified. It helps protect the beneficiaries’ interests and avoids potential disputes or challenges to the transfer in the future.
To record a lady bird deed in Florida, you typically need to submit the original executed deed along with any required fees and documentation to the Clerk of the Court in the county where the property is located. It’s advisable to consult with an attorney or a qualified legal professional to ensure that you follow the proper recording procedures in your specific county in Florida.
Can you move real estate into a trust using a lady bird deed?
Yes, you may use a lady bird to transfer assets into trust. However, that transfer would only take place after the death of the grantor (property owner). Thus, the lady bird deed can only transfer real estate into trust upon death. If an immediate transfer into trust is needed, then a different type of deed ought to be used. For example, a community property trust would likely require an immediate transfer.
What are the tax implications of a Florida lady bird deed?
The lady bird deed results in no gift tax, no documentary stamp tax, and it preserves your step-up in basis to eliminate capital gain tax. However, it does not protect against the estate tax. We go into more detail about the tax implications in this article.
Can the IRS attach a lien to an interest created by a lady bird deed?
The IRS can likely attach a lien to the grantor’s interest, but it is unknown whether the IRS can attach a lien to the remaindermen’s interests while the grantor is still alive. We go into more detail about the possible IRS liens in this article.
Can the IRS attach a lien to a lady bird deed’s remainder interest?
The IRS probably cannot attach a lien to the remainder interest created by a lady bird deed. Although this is not settled law, a review of the relevant cases indicates that the IRS has no ability to attach a lien to a lady bird remainder interest because that interest should not be considered property nor a right to property.
Normally, the IRS can attach a lien to remainder interests created by life estate deeds. In fact, any creditor with a judgment can attach a lien to a remainder interest. But lady bird deeds are not like other life estate deeds. There is a reason they are called enhanced life estate deeds. The enhancement is the ability to take back the remainder interest. That ability means that the lady bird remainder interest is probably not a valuable, transferable, legally protected right.
However, from a practical perspective, the IRS may as well have the ability to create the lien. Because this is unsettled law, title insurers will probably not be willing to insure a property when there is a tax lien on the remainder interest. And title insurance is almost certainly going to be required if you sell the property. Thus, the IRS may not technically have the ability to create the tax lien, but unless you are willing to fight the matter in court, it is better to act as if the lien does attach.
Can the IRS attach a lien to a lady bird deed’s life estate interest?
Unlike the remainder interest, the life estate interest held by the grantor is property owned by the grantor. Thus, the IRS clearly can put a lien on a life estate interest when back taxes are owed. The remainder interest may be able to escape Uncle Sam’s grasp, but the life estate interest is firmly within the scope of the IRS’s ability to levy. However, the federal lien terminates when the life estate interest terminates, meaning that the problem goes away after the taxpayer dies.
Can you use a lady bird deed if the real property has a mortgage on it?
Yes, a lady bird deed can be used even if the real property has a mortgage on it. The existence of a mortgage does not prevent the use of a lady bird deed to transfer the property to beneficiaries upon the owner’s death.
However, it’s important to note that the mortgage on the property remains in effect even after the lady bird deed is executed. The transfer of the property through the lady bird deed does not remove nor affect the mortgage obligation. The beneficiaries who receive the property through the lady bird deed would typically take over the responsibility for the mortgage payments if they decide to keep the property.
What is the difference between a lady bird deed and a warranty deed?
A lady bird deed is not the same thing as a warranty deed. However, it is possible for a single deed to be both a lady bird deed and a warranty deed.
Any deed can be a warranty deed if that deed contains certain covenants within it. Put differently, if a deed promises certain things (such as that the land is owned by the grantor), then that deed is a warranty deed. Thus, if a lady bird deed makes those promises, then that lady bird deed would also be a warranty deed. If the lady bird deed does not contain all the promises, then the lady bird deed is not a warranty deed.
If a lady bird deed is not a warranty deed, then it is either a quitclaim deed or a special warranty deed. A quitclaim deed makes no promises; a special warranty deed makes some (but not all) of the usual warranty deed promises. A lady bird deed can make any, all, or none of the promises in a warranty deed. Thus, depending on how a lady bird deed is drafted, it could be a warranty deed, special warranty deed, or a quitclaim deed.
What is the difference between a lady bird deed and a quitclaim deed?
A lady bird deed is not the same thing as a quitclaim deed. However, it is possible for a single deed to be both a lady bird deed and a quitclaim deed.
The term “quitclaim” means that the grantor makes no representations as to the grantor’s ownership of the interest being transferred. In other words, a person transferring property by quitclaim deed promises nothing about their ownership of the property. A lady bird deed can be a quitclaim deed or it can make some sort of guarantee to the grantee.
Are lady bird deeds subject to the Florida documentary stamp tax?
No documentary stamp tax is due when the lady bird deed is executed. This is clearly stated in Technical Assistance Advisement No. 20B4-004.
Can a lady bird deed be revoked in Florida?
Yes, a lady bird deed can be revoked during the property owner’s lifetime. This allows the owner to sell, mortgage, or convey the property as desired. However, it is unclear whether the grantor of a lady bird deed may reserve the right to cancel the deed entirely without selling the property to a third party.
How is a lady bird deed revoked in Florida?
To revoke a lady bird deed, you need to validly execute a new deed. The lady bird deed expressly reserved the right to convey the property, and the new deed conveys the property. Thus, the new deed will extinguish the interest created by the old lady bird deed.
What is the difference between a lady bird deed and a life estate deed?
The main difference between a lady bird deed and a life estate deed is that the grantor retains control over the property when a lady bird deed is used. A life estate deed requires the grantor to give up complete control.
With a life estate deed, the property owner (grantor) transfers the property to another party (grantee) while reserving a life estate for themselves. This means that the grantor retains the right to live in and use the property until their death, after which the property passes to the remainder beneficiaries named in the deed. The grantor cannot sell or mortgage the property without the consent of the remainder beneficiaries.
In contrast, a lady bird deed is a specific type of life estate deed that allows the grantor to retain control and flexibility. With a lady bird deed, the grantor retains control over the property during their lifetime, including the ability to sell, mortgage, or revoke the deed without the consent of the remainder beneficiaries. The transfer of the property to the beneficiaries occurs automatically upon the grantor’s death, outside of probate.
The main distinction between the two types of deed lies in the level of control and flexibility the grantor retains during their lifetime. A lady bird deed offers more control to the grantor, while a traditional life estate deed limits the grantor’s ability to sell or mortgage the property without the consent of the remainder beneficiaries.
Can a lady bird deed be used instead of a trust?
Yes, a lady bird deed can be used as an alternative to a trust in certain situations, depending on your specific circumstances and estate planning goals. However, it’s important to note that a lady bird deed and a trust serve different purposes and have distinct advantages and considerations.
A lady bird deed allows for the transfer of real estate property to designated beneficiaries upon the owner’s death while retaining control and use of the property during the owner’s lifetime. It is primarily focused on the transfer of real property and can help avoid probate for that specific asset. However, it does not provide the same level of comprehensive estate planning and asset management as a trust.
A trust, on the other hand, is a legal entity that can hold various types of assets, such as cash, investments, real estate, and more. It offers greater flexibility and control over the management and distribution of assets both during the grantor’s lifetime and after their death. A trust can provide comprehensive estate planning, including incapacity planning, privacy, control over asset distribution, and potential tax benefits.
Whether a lady bird deed or a trust is the most suitable option for you depends on various factors, including the complexity of your assets, your goals for asset management and distribution, privacy concerns, potential tax considerations, and your overall estate planning needs.
Can you use a lady bird deed if you have a reverse mortgage?
No, you should not use a lady bird deed on a reverse mortgage.
With a reverse mortgage, the loan becomes due immediately upon your death (or a number of other circumstances). Thus, the property will almost certainly be sold at your death to pay the loan. In addition, a lady bird deed can potentially trigger the acceleration clause in a reverse mortgage, which means the lender could demand repayment of the entire loan balance upon the transfer of the property.
What rights do lady bird deed remaindermen have?
Under a lady bird deed, the remaindermen (beneficiaries) named in the deed hold a future interest in the property. While the grantor retains control and use of the property during their lifetime, the remaindermen have certain rights and interests that come into effect upon the grantor’s death. These rights typically include:
Automatic Transfer: Upon the grantor’s death, the property is automatically transferred to the named remaindermen without the need for probate. The transfer occurs outside of the grantor’s estate and is not subject to the terms of the grantor’s will.
Ownership Rights: Once the property is transferred, the remaindermen become the legal owners of the property. They hold fee simple title or another ownership interest as specified in the lady bird deed, depending on the language used in the document.
Inheritance: The remaindermen have the right to inherit and take possession of the property upon the grantor’s death. They can use, sell, or otherwise manage the property according to their own wishes, subject to any applicable laws or restrictions.
Protection from Creditors: In many cases, the property transferred through a lady bird deed is protected from the grantor’s creditors. Since the transfer occurs before the grantor’s death, the property is often shielded from claims against the grantor’s estate.
However, remaindermen have no enforceable rights while the life tenant (grantor) of the lady bird deed is still alive. During that period, the grantor can cut out the remaindermen and terminate any rights the remaindermen were expecting to receive. Thus, remaindermen have rights under a lady bird deed, but these rights do not begin until the grantor passes away.
Does a lady bird deed override a will?
Yes, a lady bird deed can override the provisions of a will with regard to the property covered by the deed.
A lady bird deed is designed to transfer the property to the named beneficiaries automatically upon the grantor’s death, outside of the probate process. The transfer occurs based on the terms and conditions specified in the lady bird deed itself, regardless of what may be stated in the grantor’s will.
The lady bird deed takes precedence because it is a specific type of real estate transfer document that supersedes the general provisions of a will. The transfer of property through a lady bird deed is not subject to the terms of the grantor’s will, as the property passes directly to the beneficiaries as designated in the deed.
Can a lady bird deed have multiple grantees?
Yes, a lady bird deed can have multiple grantees, also known as remaindermen or beneficiaries. The grantor can designate multiple individuals or entities as grantees in the lady bird deed.
By including multiple grantees, the grantor can distribute the property to several individuals or entities upon their death, according to the terms outlined in the lady bird deed. The grantees will have shared ownership rights or specific interests in the property as defined in the deed.
Can you remove someone from a lady bird deed without their knowledge?
Yes, you can remove or change the remaindermen (the people who get the real estate after you die) in your lady bird deed without informing them of your actions. This is one of the main benefits of the lady bird deed. You can revoke or take the deed back. Alternatively, you can simply change to whom you want to give the property. Or you can sell the property to a third party without the signatures or consent of the people named in the lady bird deed.
Lady bird deeds do not fully take effect until death. Put differently, no transfer of real estate ownership occurs at the time you sign your deed; the transfer takes place at your death. Because of this, you have the ability to take back or modify the transfer before it occurs. As long as you are alive, you still have the ability to revoke the deed because the transfer has not yet taken place.
Can you use a lady bird deed on your homestead property in Florida?
Yes, a lady bird deed can be used on your homestead property in Florida.
By using a lady bird deed on your homestead property, you can designate the remainder beneficiaries who will automatically receive ownership of the property upon your death, without the need for probate. This can help avoid potential complications and delays associated with the probate process. Specifically, the deed can eliminate the need for your beneficiaries to file a petition to determine homestead status with the probate court.
Can you still get the homestead tax exemption in Florida after using a lady bird deed?
You can still qualify for the Florida homestead tax exemption after using a Florida lady bird deed.
The use of a lady bird deed does not typically affect the eligibility for the homestead tax exemption, as long as certain requirements are met. These requirements include:
Initial Qualification: You must have initially qualified for the homestead tax exemption by meeting the necessary criteria, such as using the property as your primary residence and submitting the required application to the appropriate county property appraiser’s office.
Continued Use as Primary Residence: After executing a lady bird deed, you must continue to use the property as your primary residence to maintain eligibility for the homestead tax exemption. This means you should continue to reside in the property for the majority of the year and provide appropriate documentation, such as driver’s license, voter registration, and utility bills, to demonstrate your residency.
Beneficiary Occupancy: If the property is transferred to the remainder beneficiaries upon your death, at least one of the beneficiaries must use the property as their primary residence to maintain the homestead tax exemption. If the property is not occupied by a beneficiary who meets the criteria for the homestead tax exemption, it could result in the loss of the exemption.
Do you still get Florida homestead protections against creditors after using a lady bird deed?
Yes, after using a lady bird deed, you keep all the homestead protections against creditors that are provided by Florida’s Constitution so long as the property remains your homestead. The homestead protections, including the exemption from certain creditors’ claims and the protection of the homestead property from forced sale, generally remain in place even after the execution of a lady bird deed.
However, it’s important to note that there are exceptions and limitations to the homestead protections in Florida. For example, the homestead protections do not apply to certain types of debts, such as unpaid taxes, mortgages, mechanics’ liens, and homeowner association assessments. Additionally, fraudulent transfers or fraudulent conveyances of property can potentially jeopardize the homestead protections.
When does a lady bird deed go into effect?
A lady bird deed, also known as an enhanced life estate deed, goes into effect immediately upon its execution and delivery by the grantor. Once the lady bird deed is properly executed and recorded, the transfer of the property rights outlined in the deed takes effect.
However, it’s important to note that the grantor retains control and use of the property during their lifetime. The transfer of ownership to the named beneficiaries, known as remaindermen, occurs automatically upon the grantor’s death, rather than immediately upon the execution of the lady bird deed.
During the grantor’s lifetime, they have the ability to sell, mortgage, or revoke the lady bird deed without the consent of the remaindermen. The remaindermen’s interest in the property only becomes active upon the grantor’s death.
Does a lady bird deed protect property from creditors?
No, a lady bird deed does not provide explicit protection from the grantor’s creditors during the grantor’s lifetime. However, it can offer some limited protection for the property after the grantor’s death.
During the grantor’s lifetime, the property transferred through a lady bird deed remains an asset subject to the grantor’s creditors. This means that creditors can potentially pursue the property to satisfy outstanding debts owed by the grantor.
However, upon the grantor’s death, the property automatically transfers to the named beneficiaries (remaindermen) specified in the lady bird deed. At this point, the property is no longer considered part of the grantor’s probate estate and thus may be shielded from claims by the grantor’s creditors. While a lady bird deed can provide some protection from creditors after the grantor’s death, it is not a foolproof asset protection strategy. Creditors may still be able to make claims against the property under certain circumstances, such as allegations of fraud or fraudulent transfers.
Can a lady bird deed be contested?
Yes, a lady bird deed can potentially be contested, just like any other legal document or transfer of property. However, the grounds and process for contesting a lady bird deed may vary depending on the specific circumstances and applicable laws in your jurisdiction.
Some common grounds for contesting a lady bird deed may include:
Lack of Capacity: If it can be demonstrated that the grantor lacked the mental capacity to understand the nature and consequences of executing the lady bird deed at the time of its creation, it may be challenged on the basis of lack of capacity.
Undue Influence: If someone exerted undue influence over the grantor, causing them to execute the lady bird deed against their true intentions, it may be contested on the grounds of undue influence.
Fraud or Duress: If there is evidence of fraud or duress involved in the creation or execution of the lady bird deed, it may be contested on those grounds.
Improper Execution: If the lady bird deed was not properly executed according to the legal requirements of your jurisdiction, such as a lack of witnesses or a failure to meet specific formalities, it may be challenged based on improper execution.
Contesting a lady bird deed can be a complex and legally involved process. It typically requires filing a legal action in the appropriate court and providing evidence to support the grounds for contestation.
Can you get title insurance if you inherit property via lady bird deed?
In general, it is possible to obtain title insurance when you inherit property through a lady bird deed. In Florida, the use of the lady bird deed is well-established in the law and should not present a problem for most title insurance companies.
Title insurance is a type of insurance that protects against potential title defects or claims on a property. Thus, because nothing about a lady bird deed creates title problems (assuming the deed was executed properly and in the proper circumstances), lady bird deeds do not generally cause title insurance problems. However, the availability and terms of title insurance can vary depending on the specific circumstances and the requirements of the title insurance company.
Can I revoke a lady bird deed without transferring the property to a third party?
The law in Florida is not clear about whether you can revoke a lady bird deed without conveying the property to a third party. Because of this, it may be difficult to find title insurance if you do this.
Lady bird deeds are allowed in Florida because of an old Florida Supreme Court case named Oglesby v. Lee. In that case, the deed allowed the grantor to “resell said lands to other parties. . . .” Thus, we know that the grantor of a lady bird deed can retain the right to resell the property to a new party. However, the case does not address whether the grantor can retain the right to simply revoke the deed without transferring to a third party. Thus, there is no clear case law establishing the right to revoke a lady bird deed without transferring to a third party.
All that being said, if you look at the reasoning in Oglesby, you will see that the key point was that the right was reserved by the grantor. The Court was primarily concerned about the right clearly being reserved in the deed, not the specifics of what that right was. Thus, it seems likely that if you reserved the right to revoke the deed without transferring, then you should have the right. For this reason, a good estate planning attorney will draft a lady bird deed with that right reserved. As long as you clearly reserve the right in the deed, then you probably will have the ability to use it down the road.
The problem here is that we have no case law to firmly establish that you can revoke a lady bird deed without a third-party conveyance. And without the case law, title insurance companies are hesitant to insure a deed that has been revoked without a transfer to a third party. In other words, the real problem here is not the law; the problem is getting title insurance.
If you want to revoke your lady bird deed without selling to a third party, you should ask your attorney to contact your title insurance company and try to work out an acceptable arrangement. There may be some creative legal solution to the problem. For example, your attorney might be able to draft a trust in which you can hold the property. You would then deed the property to your trust, which you still control. This would allow you to retain full control of the property while technically deeding it away to a third party. The title insurance company might find this to be an acceptable compromise and continue to insure title. If that is not acceptable to the title insurance company, another creative solution may be available. This is where a good lawyer will think outside the box to find a way to accomplish your goals.
Do lady bird deeds affect Medicaid eligibility?
No, lady bird deeds generally do not affect Medicaid eligibility in Florida.
The use of a lady bird deed does not typically result in a penalty period for Medicaid eligibility. The property transferred through a lady bird deed is not considered a countable asset for Medicaid purposes, allowing the individual to potentially qualify for Medicaid benefits without having to wait out a penalty period. This is all explicitly stated in the Florida ESS Manual, which sets out the guidelines for Florida Medicaid eligibility.
Can you use a lady bird deed on a time share?
In most cases, a lady bird deed is not applicable to time shares because the concept of a life estate, which is a key component of a lady bird deed, does not align with the nature of time share ownership. Time shares typically involve shared ownership among multiple individuals or entities, and the ownership structure and arrangements are governed by specific time share agreements and regulations.