Legal Question in Real Estate Law in Louisiana

Re: Revokable living trust or life lease?

Yes...

Re: Revokable living trust or life lease?

Based on the information in your original question, it is difficult to respond without seeking even more information. You mention "community property in the event of a divorce"--are you currently married? Did you and your spouse sign a "prenuptial" agreement before getting married, opting out of the community property regime? Or have you, after being married, obtained court approval for becoming separate in property?

If not, chances are great that the house is already considered community property--i.e., legally owned 1/2 by each spouse. As such, both spouses would have to agree to transfer the property to your son in Vermont. If both of you agree to do this, I don't think transferring title to your son would be a real problem. In order to remain in the house as long as you live following transfer of title to your son, BEFORE transferring title or simultaneously with that transfer, you should have your son sign a "Right of Habitation" allowing you and your spouse a legal, irrevocable right to live in and stay in the house for the rest of your lives. This is a legal act, signed before a notary and two witnesses. Failure to do this might result, one day, with your son in Vermont changing his mind--now that he legally owns your house--and kicking you out on the street or selling the house out from under you for quick cash needed for a new boat or gambling habit or ??? Good intentions do not always survive future unforeseen problems.

Now, about avoiding taxes and successions, a transfer such as you are contemplating--if done more than one year before your deaths--would probably avoid inclusion of that property within your successions and the inheritance taxes that would go along. However, if you own anything else--bank accounts, stocks, vehicles, jewelry, etc.--a succession will almost always be required to properly transfer their ownership after your deaths.

These "trusts" or "life lease" things you mention are probably not a way to truly avoid successions--in Louisiana, trusts still have to be probated and confirmed by a court in a succession proceeding after someone dies. I have yet to see how these "avoid probate with a trust" entrepeneurs have been able to completely avoid a succession. I'm not too sure even what a "life lease" might be--I do not believe it is a valid act under Louisiana law. It may be what other "common law" states call what I am referring to as a "Right of Habitation". Not sure.

Good luck.