What is a lady bird deed?
A lady bird deed lets you name who inherits your house, keeps the property out of probate, and, this is the part that matters, leaves you completely free to sell it, mortgage it, or change your mind, without asking anyone's permission.
Where the name comes from
It is a piece of American legal folklore: the instrument is said to be named after Lady Bird Johnson, on the story that President Johnson used one to convey property to her. The story is almost certainly apocryphal (the name was popularized by a Florida attorney in the 1980s) but it stuck. The formal name is an enhanced life estate deed.
What makes it 'enhanced'
A traditional life estate deed splits ownership: you get to live there for life, and the remaindermen own everything afterward. Their interest is real and present, which means you can't sell or refinance without every one of them signing. Many people discover this the hard way when they need to move.
A lady bird deed adds a retained power: the right to sell, mortgage, lease, gift, or take the property back entirely, without the remainder beneficiaries' consent, and to keep all the proceeds. That reservation is the enhancement, and it changes everything about how the instrument behaves.
| Feature | Lady Bird deed | Life estate deed |
|---|---|---|
| Can you sell without permission? | Yes | No |
| Can you refinance? | Yes | No |
| Can you revoke it? | Yes | No |
| Beneficiary's creditors can attach? | No, not while you live | Yes |
| Avoids probate? | Yes | Yes |
| Step-up in basis at death? | Yes, generally full | Yes, generally full |
| Medicaid divestment on signing? | Generally no | Generally yes |
Which states recognize it
Florida, Michigan, Rhode Island, Texas, Vermont, and West Virginia. Maryland's courts also recognize a similar instrument, the life estate deed with powers. Missouri's courts also recognize a similar instrument, the life estate deed with powers. Virginia law also recognizes a similar instrument, the life estate deed with powers. Outside those states, a title company will generally not accept the retained power as valid, so the deed won't do what you expect even if a county office physically records it.
Not in one of those states?
34 states plus DC offer a transfer-on-death deed, which achieves something very similar under a statute rather than common law. It is arguably the safer instrument where both are available.
Why Florida and Texas practitioners like it
- Homestead exemptions survive. Because you keep the life estate, the homestead exemption and any assessment cap generally stay in place. In Florida the deed still does not override the homestead protections of a spouse or a child under 18. Deedly does not prepare a Florida lady bird deed of a home when an owner has a child under 18, or is married to someone who is not also an owner signing the deed. In those cases Florida's homestead rules can void or override the deed, and the fix needs a Florida attorney.
- Full step-up in basis. The property is still in your estate for tax purposes, so your heirs get the date-of-death value as their basis. That can be worth far more than the probate savings.
- Medicaid treatment. In states that recognize the instrument, it is generally not treated as a divestment when signed, because you gave nothing away. Rhode Island is the exception: it counts a home held under this kind of deed against long-term care Medicaid (R.I. Gen. Laws § 40-8-3.1). Estate recovery is a separate question and the rules change. Get advice.
- No probate on the property. Beneficiaries record a death certificate and an affidavit and the title is theirs.
The honest downsides
- It is a common-law instrument in most of these states, not a statutory one. That means less certainty than a statute would give, and the position can shift.
- It doesn't touch your mortgage. The loan and any due-on-sale clause survive untouched.
- It doesn't protect the property from your creditors while you're alive.
- If all your named beneficiaries die before you and there is no alternate, it fails and the property goes through probate anyway.
- Some title insurers ask questions about them. Confirm with a local underwriter before relying on one for a large estate.
$49, one time. Deedly prepares it in FL, MI, RI, VT and WV.
Common questions
Yes, on the same grounds as any deed: forgery, lack of capacity, undue influence, or defective execution. It is harder to attack than a will, because the transfer happens automatically at death rather than through a probate court where objections are invited. More detail.
Yes, for that property. The remainder beneficiaries take title automatically at your death by recording proof of death. Everything else you own still goes through your will or your trust.
Yes. That is the entire point of the instrument. You keep the power to sell, mortgage, lease, or gift the property without your beneficiaries' consent, and you keep every dollar of the proceeds. If you sell, their interest simply evaporates.
At your death your life estate ends and the property belongs to them, outside probate. To show that in the public record, they record a certified death certificate with the county recorder; some counties and title companies also want an affidavit of death. Step by step.
For a single property, it is dramatically cheaper ($49 versus $1,000–$3,000) and simpler. A trust covers everything you own, handles incapacity, and stays private. Many people use a lady bird deed for the house and a small trust or a will for everything else. Full comparison.
Keep reading
Deedly is not a law firm
Its software and documents are not a substitute for the advice of an attorney. We provide self-help software and state-specific deed forms; you make your own decisions about your property. Using Deedly does not create an attorney-client relationship, and nothing here is legal advice. If your situation is complex or contested, talk to a licensed attorney in your state.