A lady bird deed, which is also referred to as an enhanced life estate, is a type of deed that a lot of times is used in long-term care Medicaid planning. Medicaid has a lookback rule, that says if you transfer assets within a five year period, that it can be counted against you. Well, that can apply to real property too, so a lady bird deed, what actually happens is the individual retains ownership of the real property for their lifetime, and then as soon as they pass away, it goes to whoever they want it to go to. Because they retain ownership during their lifetime, it is not considered a gift, an improper transfer, for purposes of Medicaid, so it helps them qualify for Medicaid. Now, these deeds should not just be done by anybody for any reason, and they’re very specifically used, and you really need to see an elder law attorney to make sure it’s appropriate in your situation.
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