According to The Wall Street Journal: Market Watch, a life estate deed is an increasingly popular estate planning tool that allows you to pass on the family home or other property with ease. The deed allows the current owner to remain the owner until death and then pass it on to the designated heir, avoiding probate court. Also, when the new owner sells the home, they often will avoid capital gains taxes because the fair market value of the property is his or her tax basis.
Life estate deeds are often much cheaper than other estate planning tools. However, they are not for everyone. Before making any estate planning decisions, you should meet with a qualified estate planning attorney and discuss what is best for your unique situation.