A Florida Ladybird deed has become one of the increasingly most used estate planning tools by the some of best Jacksonville estate planning attorneys. One common questions we receive at our Jacksonville estate planning law firm is how the Ladybird deed works under Florida’s current homestead protections.
In Florida, a Ladybird deed is also known as an enhanced life estate deed. This type of deed permits a person or family that owns real estate, most often a home, to transfer a future interest in the property while keeping a present interest. This type of transfer permits the person to live on the property until he or she dies. A Ladybird deed is special because it allows the enhanced life estate holder more power than a standard life estate holder. Unlike the standard life estate deed, the ladybird deed allows the life tenant (typically the original owner) to sell, convey, or mortgage the property and the holder is not liable to the future interest holders for misuse of the property.
Is the Lady Bird Deed tested or does it belong in Uncharted Territory
While it is clear the Ladybird deed has a lot of great qualities, what isn’t clear is how the deed works under Florida’s current homestead protection laws. Florida prohibits the devise of homestead property if a spouse or a minor child survives the owner of the house. According to the court’s decision In re Estate of Johnson, 397 So.2d 970 (Fla. 4th DCA 1981), this protection has been expanded to revocable trusts and most likely Ladybird deeds.
So the issue then becomes can the grantor of a Ladybird deed, the person that retains the life estate, give a future interest to a third party if he or she has a spouse or a minor child? So far Florida Courts and Legislature have no clear answer. If the grantor of the deed does have a spouse or minor child, then the interest of the person holding the remainder may be called into question.
For this reason and others, we at the Law Office of David Goldman PLLC often recommend other estate planning tools if you wish to devise a homestead property and currently have a spouse or minor child.
Florida courts have always shown a strong preference for protecting homestead property, and courts often try to exercise every opportunity to extend this protection. A homestead protection is significant because it allows a Florida resident to keep his or her home even if this person declares bankruptcy. This protection means creditors cannot force the sale of a person
For more information on a Florida Ladybird deed, please contact our office today at 904-685-1200.