While many testators want to leave their estates to a surviving spouse or another party, it is also not uncommon to take steps to ensure that the remainder of the estate will be available to someone else after the first beneficiary passes away. When drafted correctly, these documents can help families avoid conflict over the disposition of assets after a loved one’s death. Unfortunately, when this level of care is not taken, surviving spouses or children may contest the terms of the document, so if you have concerns about the validity of your life estate, you should consider speaking with an experienced contested estates attorney who can help ensure that your wishes are respected.
Creating a Life Estate
While life estates give surviving spouses or another primary beneficiary the exclusive right to use a decedent’s personal or real property, they are also restrictive and can prevent that beneficiary from liquidating certain assets prior to his or her death. Once that person, known as the life tenant owner, passes away, the life estate dissolves and a second beneficiary, or the remainder owner, will receive the remainder of the assets. Creating a life estate has a number of advantages, including:
During their lives, life tenants have a responsibility to maintain property taxes, maintenance, and insurance and are entitled to rent out property or receive income generated by it. However, once the life tenant passes away, the remainder owner designated by the testator is automatically granted legal ownership of the property.
There are also disadvantages to creating a life estate. For example, a life tenant cannot sell the property unless he or she is given consent by all other life tenants and all remainder owners. Once this consent is given, a life tenant loses his or her right of sole control over the property. Furthermore, transferring property into a life estate is irrevocable. The only exception to this rule is when all life tenants and remainder owners agree to the change. However, it is important to note that any changes could have negative tax or Medicaid-related consequences.
Call Today to Discuss Your Case with a Dedicated Chicago Contested Estates Attorney
To speak with an experienced contested estates attorney about your own life estate or the life estate of a loved one, please contact Orlowsky & Wilson, Ltd. Attorneys at Law at 847-325-5559 today.