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claim against the property that would affect your right to live in the home during your lifetime.

• Tax benefits. An LED offers the ability to get a “stepped-up basis” at capital gains upon a potential sale of the home after the death of the life tenant. The remainderman typically will receive the same tax treatment as if the property had passed to them at death with a stepped-up basis.

In addition, the life tenant continues to qualify for and receive many property tax exemptions during their lifetime (i.e. homestead exemption, senior citizen tax exemption etc.)

There are, however, some pitfalls of LED:

• Deceased remainderman. If one or more of your named remainderman dies, their interest in the property becomes part of their own estate.

• Sale of property. If the life tenant sells the property, the remainderman is entitled to share in the sale proceeds.

• Mortgage. If there is still a mortgage on the home, or the current owner wants to remortgage the home, a bank or lender may have an issue with a remainderman being on the deed. It’s recommended that prior written consent from a bank or lender is obtained before an LED is signed.

Overall, a life estate deed does offer many benefits, especially for smaller families or those whose primary assets are their homes. While this estate planning tool on its face might not be best suited for everyone, you should consider all of your options that may be available to you.

To learn more about life estate deeds and discuss your estate planning goals, contact an estate planning attorney.

Jada L. Gaines is an associate attorney with Elder Law & Estate Planning Center in Bluffton. hiltonheadelderlaw.com