![]() A life estate, as opposed to an outright gift, will decrease the penalty period that will make you eligible for Medicaid. Most people execute a life estate deed for Medicaid purposes. On the other hand, as an owner of the life estate property, the life tenant is responsible for all rights and obligations of a homeowner: maintenance costs, real property taxes, and insurance. The remainderman is not entitled to the rent and profits of the life estate property while you are still alive and does not have any interest in the property until after you die. If you don’t want to live in the property, you can rent it out, and only you will be entitled to the rent and profits of the property. Life tenant’s rights and dutiesĪs a life tenant, you have the right to use and occupy the property until you die. You need to consult with a lawyer whether the life estate deed is the most appropriate estate planning tool for your situation, given your objectives. For this reason, executing this life estate deed is a major decision. Once you execute the life estate deed, you cannot take it back without the consent of the remainderman. The life tenant owns the life estate property for purposes of homeowner’s insurance, and the life tenant is still eligible for STAR exemption, veteran’s benefits, and homestead and other tax breaks.Ī life estate is irreversible and irrevocable. Still, the life tenant owns the property in a life estate for most intents and purposes. However, the life tenant has limited ownership rights because the life tenant cannot sell, dispose, transfer, encumber, or mortgage the property without the consent of the remainderman. In the life estate arrangement, both the life tenant and the remainderman are considered joint owners of the property. Once the life tenant dies, the remainderman obtains absolute ownership over the property simply by filing with the County Recorder a certified copy of the death certificate of the life tenant and an affidavit. The life tenant is the person to whom use and possession is reserved for the rest of his life until death. In a life estate arrangement, there are two parties: the life tenant and the remainderman. What is a life estate?Ī life estate is an arrangement where one person transfers to another property, reserving for himself the right to use and possess the property for the rest of his life. If you are considering the execution of a life estate over your house, you must be wondering, “who owns the property in a life estate?” To put simply, both the life tenant and the remainderman are considered joint owners of the property, but in different durations. The life estate has become a popular tool for estate planning due to its ease of execution and affordability.
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