When writing a will, someone may also wish to leave property or funds to a loved one without going through probate. Simply writing the will is simply not enough to avoid probate. For those who wish to leave a home to their loved ones, but wish to make sure that probate is avoided, a life estate is a good choice. A life estate is almost like joint ownership of property.. With a life state, you actually give your home to your loved ones, (or convey it to them), but retain the right to live in and control the home until you pass away.. You will then be known as the “life tenant,” and your loved one will become the “remainderman.” you can of course have more than one remainderman; it’s usually all the adult children.. If you need advice on setting up a life estate, give Attorney Thomas R Mullen of Quincy, Massachusetts a call.
What Do I Need A Life Estate?
Most people choose to have a life estate when they want to be sure their chosen recipient receives the property intended for them, without having to go through probate court. If your assets are still titled in your name upon your death, your property will have to go through probate. If you have already set up a life estate, then your loved one’s name is already on the property, and therefore probate is avoided and the property is theirs.
Am I Still Responsible for the Property in a Life Estate?
Yes. If you have a life estate in which you are the life tenant, you are still responsible for the mortgage, property taxes, and insurance.. Any repairs which are needed on the property are still your responsibility as well. While you can make an agreement with your loved one that they will take on some of these responsibilities once the life estate is established, it is still your responsibility if they fail to do so.
Will a Life Estate Help Me If I Have To Enter a Nursing Home
If you are concerned about losing your home if you enter a nursing home, a life estate is for you. Remember, after you sign the life estate deed, you no longer actually own the home; you have the right to live there. When the MassHealth worker asks if you own a home, the answer is a NO ! Of course, if your spouse still lives in the home, its protected anyway. But sooner or later there will only be on of you and without the life estate, that beautiful home of yours will be sold to pay your nursing home costs.
Problems Which Could Arise With Life Estates
Although a life estate is a great way to transfer your property to your loved one, there are problems which could arise. For example, once you have become the life tenant on your property, then you cannot sell or mortgage the property without the consent of the remainderman. Selling a property which has been placed in a life estate will cause tax issues for both you and the remainderman.. The remainderman may have to pay a twenty per cent capital gains taxes on any profit they make off the property. There is a simple way to avoid this if done properly. Those are a few of the issues which could arise from a life estate. For more information on how a life estate could benefit your family, give Attorney Tom Mullen a call today at 617-770-1050.
