Posted by Bishop L. Toups | In Estate Planning
Lady bird deeds, also known as enhanced life estate deeds, have become increasingly popular in Florida in recent years. These deeds allow property owners to transfer their property to someone else upon death without going through probate. But what happens to the homestead status of the property when a lady bird deed is used?
In Florida, the homestead exemption is a valuable asset that provides property owners significant tax savings and protection from creditors. To qualify for the homestead exemption for tax savings, the property must be the owner’s primary residence and have filed for the exemption with their local property appraiser. The homestead exemption also protects the forced sale of the homestead by most creditors, meaning that a creditor cannot force the sale of homestead property to satisfy a debt.
Lady bird deeds do not affect the homestead status of a property in Florida. Lady bird deeds are designed to transfer the property to the named beneficiary only upon the owner’s death, not during the owner’s lifetime. The property owner retains complete control and ownership of the property during their lifetime, including the right to claim the homestead exemption.
Using a lady bird deed can be a smart estate planning strategy for Florida property owners who want to ensure their property passes to their chosen beneficiary without going through probate while maintaining their homestead status. It can also provide added protection for the beneficiary, as they become the owner of the property immediately upon the death of the property owner, without the need for any court proceedings or delays.
In conclusion, lady bird deeds do not affect the homestead status of a property in Florida. Property owners can use lady bird deeds as a smart estate planning tool to transfer their property to their chosen beneficiary without going through probate while maintaining their homestead status and protection against forced sale by creditors. As with any estate planning tool, property owners should consult with an experienced attorney to determine whether a lady bird deed is appropriate for their unique situation.
IRS Bills? The Internal Revenue Service can wreak havoc on your life. This book has the information and strategies you need to confront America’s most intimidating agency.View on amazon
Create a business tax strategy that will save you time, energy and money. Getting your tax on track will free time to do what really counts - running a profitable business.View on amazon
Worried about escaping an audit intact? Then you need Surviving an IRS Tax Audit. This book explains what to say, what to do, even what to wear, so that a visit from the auditor doesn't turn into a disaster.View on amazon