A Lady Bird deed is a deed that allows a real property owner to transfer ownership of the property to another person or entity while continuing to use and control the property.

In some states a Lady Bird deed may be used as an estate planning tool, allowing the owner to make a lifetime gift of the property; avoid federal gift taxes (because it is an incomplete gift and is not final); avoid probate; qualify for Medicaid benefits; and continue to live in their private home after transferring ownership (title) of it to another person or entity.

A Lady Bird deed may also be referred to as an enhanced life estate deed, as it effectively gives the owner a life estate interest in the property while transferring ownership (title) to another person or entity.

Laws vary from state to state, but a Lady Bird deed may also allow the owner to continue to have complete control of the property, without input from the grantee under the Lady Bird deed. This may include the owner’s right to change their mind and sell or transfer the property to another person or entity, or to make changes to the property.

In Michigan, a Lady Bird deed, also known as an enhanced life estate deed, is a recognized estate planning tool that allows property owners to retain control over their property until death, while designating a beneficiary to automatically receive the property upon their passing. This type of deed enables the property owner to avoid probate, as the property directly transfers to the beneficiary without being part of the probate estate. The owner retains the right to use and control the property, including the ability to sell or mortgage it, without the beneficiary's consent. Additionally, because the transfer is not considered complete until the owner's death, it typically does not trigger federal gift taxes. Lady Bird deeds can also be beneficial in Medicaid planning, as the transfer of property may not affect Medicaid eligibility. However, it's important to consult with an attorney to understand the specific implications and to ensure that the deed is properly drafted and executed according to Michigan law.