Florida does not authorize a transfer on death deed for real estate. Roughly 30 states let an owner name a beneficiary directly on the title to a house or land, but Florida has never adopted the Uniform Real Property Transfer on Death Act or any equivalent statute. Florida law does permit transfer-on-death designations for securities and financial accounts under Chapter 711, but that statute does not reach houses, land, or other real property.1The Florida Legislature. Florida Statutes Chapter 711 – Florida Uniform Transfer-on-Death Security Registration Act To pass real estate to a named beneficiary at death without probate, Florida owners use an Enhanced Life Estate Deed, commonly called a Lady Bird Deed.
The Florida Alternative: The Lady Bird Deed
An Enhanced Life Estate Deed is a Florida common-law instrument that names a future beneficiary (the “remainderman”) while leaving the owner in complete control of the property for life. When the owner dies, title passes automatically to the remainderman. No court involvement is required, and the beneficiary files no petition. Functionally, it delivers what a transfer on death deed delivers in other states, just through a different legal mechanism.
The deed creates a life estate in the owner with “enhanced” powers. That enhancement is what separates it from a traditional life estate, where the owner would need the remainderman’s consent to sell or mortgage. Because the deed is a creature of common law rather than statute, Florida has no standard statutory form, and the specific reservation-of-powers language in the deed matters.
What the Owner Keeps During Life
The point of the enhanced label is that the owner gives up nothing during life. The owner can sell the property, mortgage it, lease it, give it to someone else entirely, or change the named beneficiary at any time. None of those actions require the remainderman’s knowledge or consent.2UF Advisor Network. Using Enhanced Life Estate Deeds to Pass Real Property to Charity: Opportunities, Pitfalls, and Best Practices If the owner sells before death, the remainderman gets nothing and has no legal claim.
The remainderman’s interest is typically characterized as a vested remainder subject to complete divestment. The beneficiary holds a future interest that can be wiped out at any time by the owner’s decision to sell, mortgage, or re-deed. The beneficiary only takes the property if the owner still holds it at death and has not revoked or replaced the deed.
Medicaid Eligibility and Estate Recovery
The interaction with Medicaid is one reason the Lady Bird Deed is popular in Florida. Two questions come up: eligibility during life, and recovery after death.
Because the owner keeps the power to revoke and sell at any time, recording the deed is not treated as a transfer for Medicaid eligibility purposes. Nothing has actually been given away. No look-back penalty is triggered, and the home continues to be treated the same as any other homestead for qualification. That distinguishes it from an outright gift of the property, which can create a penalty period.
After death, Florida’s Medicaid Estate Recovery Act allows the state to recover payments by filing a claim in the deceased recipient’s probate estate. The statute directs recovery through probate proceedings under Part VII of Chapter 733.3The Florida Legislature. Florida Statutes 409.9101 – Recovery for Payments Made on Behalf of Medicaid-Eligible Persons Property held under a Lady Bird Deed passes directly to the remainderman outside probate, so it is not part of the probate estate and the state’s recovery mechanism does not reach it. For anyone facing long-term care costs, this is often the deciding factor.
Tax Treatment
Gift Tax
Recording a Lady Bird Deed does not trigger federal gift tax. For a transfer to count as a completed gift, the donor must permanently give up control. Because the owner retains the unrestricted right to revoke, sell, or change the beneficiary, the IRS does not treat the recording as a taxable gift, and no gift tax return is required.
Stepped-Up Basis
Property transferred through a Lady Bird Deed qualifies for a stepped-up tax basis. Because the owner retained a life estate with the power to revoke, the property is included in the gross estate under Treasury Regulation ยง 20.2036-1. The remainderman inherits with a basis equal to fair market value on the date of death rather than the original purchase price.4Internal Revenue Service. Gifts and Inheritances If the owner bought the home for $120,000 decades ago and it is worth $450,000 at death, the remainderman’s basis is $450,000, so a sale shortly afterward would produce little or no capital gains tax.
Homestead Exemption and Documentary Stamps
Recording the deed does not jeopardize your Florida homestead property tax exemption. Because the owner keeps complete ownership and control, the property’s tax status is unchanged, and both the $25,000 exemption and any Save Our Homes assessment cap remain in place. An outright gift, by contrast, can cause loss of the exemption and a reassessment.
Florida imposes a documentary stamp tax on deeds that convey real property, calculated at $0.70 per $100 of consideration.5The Florida Legislature. Florida Statutes 201.02 – Tax on Deeds and Other Instruments A Lady Bird Deed transfers no present beneficial interest and usually involves no monetary consideration, so the documentary stamp tax at recording is minimal, typically just the minimum filing amount.
Risks Worth Weighing
If the Beneficiary Dies First
This is where these deeds can create real problems. If the named remainderman dies before the owner, the remainder interest does not simply vanish. Title insurance underwriters in Florida generally treat the interest as vested, meaning it may pass to the deceased beneficiary’s heirs or through their estate. If the owner then dies without recording a replacement deed, a probate proceeding for the deceased remainderman’s estate could be required to clear title. The fix is to record a new deed whenever a remainderman dies, but people forget, or don’t realize the issue exists.
Existing Mortgages
If the property still carries a mortgage, the lender’s due-on-sale clause is a fair question. Federal law bars lenders from accelerating a residential mortgage for certain transfers, including transfers into a trust where the borrower remains a beneficiary, transfers to a spouse or child, and transfers at the borrower’s death.6Office of the Law Revision Counsel. 12 U.S. Code 1701j-3 – Preemption of Due-on-Sale Prohibitions A Lady Bird Deed is not explicitly listed, though it is arguably analogous to a trust transfer since the borrower keeps complete control. In practice most lenders do not treat the deed as triggering the clause, because no actual ownership transfer occurs during the borrower’s lifetime. Notifying the lender or consulting an attorney first is the cautious move.
Elective Share for a Surviving Spouse
Florida’s elective share statute may treat property in a Lady Bird Deed as part of the owner’s elective estate. Because the remainderman’s interest can be revoked by the life tenant, the property can be pulled into the calculation if a surviving spouse elects against the will. The deed remains valid, but a surviving spouse may have a claim against the property’s value. Anyone married and considering this deed should factor that in.
Title Insurance
Because the deed is a common-law creation rather than a statutory one, some title insurers are more cautious when insuring property that has passed through it. Underwriting standards vary. When the remainderman later sells, the title company may ask for additional documentation to confirm the deed’s validity and rule out competing claims. Working with an attorney familiar with these deeds reduces delays at that stage.
Creating and Recording the Deed
A Lady Bird Deed is a written instrument that must include:
- The full legal name and mailing address of the current owner, the life tenant.
- The full legal name of each person designated to receive the property at death.
- The formal legal description from the existing deed or title policy, not just the street address.
- Specific language reserving the owner’s right to sell, mortgage, lease, or revoke without the remainderman’s consent. This language is what makes the deed enhanced rather than a standard life estate.
Florida law requires the grantor to sign in the presence of two subscribing witnesses, and the signature must be notarized. Florida permits electronic witnessing through audio-video communication, so the parties don’t always need to be in the same room.7The Florida Legislature. Florida Statutes 689.01 – How Real Estate Conveyed
Once signed, witnessed, and notarized, the deed must be recorded in the official records of the county where the property sits. Recording provides public notice and ensures the transfer can happen as planned at death. County recording fees vary but are generally modest, typically under $50 for a short document.
Changing Your Mind
One of the strongest features of a Lady Bird Deed is how easy it is to undo. Revoking simply requires recording a new deed. The owner can execute a quitclaim deed back to themselves that expressly revokes the earlier deed, or record a new Lady Bird Deed naming a different remainderman. Either eliminates the prior beneficiary’s interest. No court approval is needed, and the remainderman need not agree or be notified. The new deed must meet the same execution requirements as the original: two witnesses, notarization, and recording in the county where the property sits.