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Monday, August 28, 2017

The Benefits of a Lady Bird Deed

Also referred to as an “enhanced life estate deed,” the lady bird deed is a useful estate planning tool that allows for the automatic transfer of property to a designated beneficiary upon death. It also has the added benefit of allowing you to retain full ownership rights of the property during your lifetime. It is very similar to the traditional life estate deed, but the added benefit is that you, as the property owner, can still sell, mortgage, or make other property related transactions without seeking the approval from the “remainderman” or “remainder beneficiaries.”  The remainder beneficiaries are those who the property will transfer to upon your death.

Texas is one of the few states to recognize the validity of a Lady Bird Deed and it is a great thing to take advantage of if you own real property. There are so many beneficial estate planning tools you can put in place to protect the continued interests of you and your loved ones. If you live in Texas and have yet to take care of the vastly important estate planning process, contact the Law Office of Carey Thompson, PC. We work with our clients to develop comprehensive estate plans that take into account a person’s unique circumstances.

What are the benefits of a lady bird deed?

When properly created, a lady bird deed has several key benefits, including:

  • Avoiding probate:  The property is automatically transferred upon the death of the grantor which eliminates the need for the property to go through probate. This means the property avoids the public probate process. Additionally, probate can be time consuming and costly. It is best to avoid it when possible.

  • Avoiding tax: Using a lady bird deed will give you the opportunity to avoid the federal gift tax. This tax does not apply to this type of property transfer.

  • Retaining ownership interests: A lady bird deed grants you a lot of flexibility that can be very useful. Even after the deed is put in place, you still retain your ability to control the piece of property. You may still transfer the property or use the property as you see fit. There is no need to get permission from the remainder beneficiaries. You also have the ability to change the remainder beneficiaries at any time. This flexibility is one of the most unique and beneficial features of the lady bird deed.

Be certain that your lady bird deed is in compliance with Texas law to ensure you receive all of the above-listed benefits. The deed must specify the piece of property and list the remainder beneficiaries. You may select one or more beneficiaries. The deed must also specify that you retain the right to use, sell, and otherwise deal with the property throughout your lifetime. Upon your death, all the remainder beneficiaries have to do is file your certificate of death in land records. This is all that is needed for the property to transfer.

Meeting all of your estate planning needs.

Estate planning involves many different legal tools that work to accomplish important plans you have for the future of you and your loved ones. Talk to the dedicated estate planning attorneys at the Law Office of Carey Thompson, PC and see what a personalized, comprehensive estate plan can do for you.


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