What is a Lady Bird Deed?
A Lady Bird Deed is an estate planning tool in Florida. It’s also known as an Enhanced Life Estate Deed. When President Lyndon B. Johnson used this type of deed to convey property to his wife Lady Bird Johnson, the phrase “Lady Bird Deed” caught on as a nickname for the Florida enhanced life estate deed.
It is designed to allow property owners in Florida to transfer property to others automatically upon their death while maintaining use, control, and ownership while alive.
Lady Bird deeds are popular because they provide a way to transfer ownership without having to probate the home or property. This provides peace of mind and can help ease the burdens placed on loved ones during challenging times.
Just as importantly, recording an enhanced life estate deed does not interfere with the owners’ control over their home or property during their lifetime.
No estate-planning strategy is without some disadvantages and enhanced life estates are no exception. Florida’s constitutional homestead protections include rights reserved to spouses and minor children. Real estate transfers that infringe on any of these rights – including transfers made via Lady Bird deeds – are void. So, property owners with spouses or minor children need to take special care when executing a Lady Bird deed – or might not be able to use an enhanced life estate at all.
Another potential risk is that if a remainderman passes away prior to the life tenant, the remainder interest may have to pass through probate.
A property subject to an enhanced life estate may also be more difficult to sell than a property held in fee simple or in a Florida revocable living trust.
Each family is unique, and therefore, each family requires a unique estate plan.