Life Estate Deed (Reserved Life Estate) - Arizona

LIFE ESTATE DEED (RESERVED LIFE ESTATE)

State of Arizona

Recording Requested By:
_____________________________________________

When Recorded Mail To:
_____________________________________________
_____________________________________________
_____________________________________________

Mail Tax Statements To (Life Tenant):
_____________________________________________
_____________________________________________
_____________________________________________

SPACE ABOVE THIS LINE FOR RECORDER'S USE

IMPORTANT — THIS IS A TRADITIONAL RESERVED LIFE ESTATE DEED, NOT A "LADY BIRD"/ENHANCED LIFE ESTATE DEED.
By this deed the Grantor conveys the remainder in fee simple to the Remainderman now, while RESERVING a life estate to the Grantor (or a named life tenant). On the life tenant's death, the life estate ends and the remainder becomes possessory in the person entitled under Section 5.2 (A.R.S. § 33-234), without probate of the life tenant's estate for this transfer.

Because this is a traditional life estate, the remainder conveyance is PRESENT and IRREVOCABLE: the life tenant CANNOT sell, mortgage, or revoke the deed, and cannot convey clear fee title, without the Remainderman joining. This is different from an enhanced life estate ("Lady Bird") deed (which retains the power to sell/revoke without the remainderman's consent) and from an Arizona beneficiary (transfer-on-death) deed under A.R.S. § 33-405 (which is revocable and transfers nothing until death). If you want a revocable transfer, use the Beneficiary Deed or Lady Bird Deed form instead of this one.

DOCUMENT INFORMATION

LIFE ESTATE DEED

KNOW ALL PERSONS BY THESE PRESENTS:

This Life Estate Deed is made and entered into this _____ day of _________________, 20_____.

ARTICLE I: PARTIES

Section 1.1 Grantor

Name(s): _____________________________________________

Marital Status / Character of Title:
☐ A single person
☐ A married person, as sole and separate property
☐ Married persons, as community property
☐ Married persons, as community property with right of survivorship
☐ An unmarried person
☐ A _________________ [entity type], a _________________ [state] _________________ [entity form]

Address: _____________________________________________
_____________________________________________

hereinafter called "GRANTOR"

Section 1.2 Remainderman (Grantee)

Name(s): _____________________________________________

Manner of Holding the Remainder:
☐ A single person
☐ As community property (spouses)
☐ As community property with right of survivorship (spouses)
☐ As joint tenants with right of survivorship
☐ As tenants in common (state shares: ______________________)
☐ A _________________ [entity type], a _________________ [state] _________________ [entity form]

Mailing Address:
_____________________________________________
_____________________________________________

hereinafter called "REMAINDERMAN" or "GRANTEE"

Section 1.3 Life Tenant (Measuring Life)

The life estate reserved by this deed is measured by the life of:

☐ The GRANTOR named in Section 1.1 (most common); OR
☐ The following named life tenant: _____________________________________________
(Name and address of the person whose life measures the estate)

hereinafter called the "LIFE TENANT." The natural life of the Life Tenant is the "MEASURING LIFE."

Section 1.4 Relationship of the Parties

The Remainderman is the Grantor's: _____________________________________________
(e.g., spouse, child, grandchild, sibling — a natural object of the Grantor's bounty)

ARTICLE II: CONSIDERATION

Section 2.1 Consideration Recital

This conveyance is made for and in consideration of the natural love and affection the Grantor has and bears for the Remainderman, and for no monetary consideration (the recited sum of $0.00 / nominal Ten and No/100 Dollars ($10.00) being acknowledged as nominal only).

THE GRANTOR HAS RECEIVED NO MONETARY CONSIDERATION IN RETURN FOR THE REMAINDER CONVEYED.

ARTICLE III: CONVEYANCE — GRANTING CLAUSE AND RESERVATION

Section 3.1 Granting Clause (Remainder in Fee Simple)

For and in consideration of the natural love and affection set forth above, and for no monetary consideration, GRANTOR does hereby GRANT AND CONVEY unto the REMAINDERMAN, and the Remainderman's heirs, successors, and assigns forever, the remainder in fee simple in and to all of the following described real property situated in _________________ County, State of Arizona:

See Exhibit "A" attached hereto and incorporated herein by reference.

RESERVING UNTO THE LIFE TENANT, however, a LIFE ESTATE in and to said property for and during the full term of the natural life of the Life Tenant (the Measuring Life), as set forth in Article IV below. Pursuant to A.R.S. § 33-204, the interest conveyed to the Remainderman is a future estate (remainder) dependent upon the precedent life estate; pursuant to A.R.S. § 33-234, that remainder takes effect in possession only on the death of the Life Tenant.

Section 3.2 Legal Description

See Exhibit "A" attached hereto and incorporated herein by reference.

Together with all and singular the tenements, hereditaments, and appurtenances thereto belonging or in anywise appertaining, and the reversion and reversions, remainder and remainders, rents, issues, and profits thereof, subject to the reserved life estate.

Property Address (if applicable): _____________________________________________

Assessor's Parcel Number: _____________________________________________

ARTICLE IV: RESERVATION OF LIFE ESTATE

Section 4.1 Rights of the Life Tenant

The Life Tenant reserves and retains, for and during the entire Measuring Life, the exclusive right to possess, occupy, use, control, and enjoy the property, together with all rents, issues, and profits therefrom, to the same extent as the Life Tenant enjoyed before this conveyance. The Remainderman shall have no right of possession during the Measuring Life.

Section 4.2 Duties of the Life Tenant

During the Measuring Life, the Life Tenant shall, at the Life Tenant's own expense:

(a) Pay all real property taxes and assessments as they become due;

(b) Maintain reasonable casualty/hazard insurance on the improvements;

(c) Pay interest on any encumbrance to which the property is subject and keep the property free of liens chargeable to the Life Tenant;

(d) Make ordinary repairs and perform ordinary maintenance necessary to preserve the property.

Section 4.3 Duty Not to Commit Waste

The Life Tenant shall NOT commit or suffer waste upon the property and shall not do or permit any act that materially and permanently injures the inheritance or diminishes the value of the Remainderman's interest. The Remainderman retains all remedies available at law and in equity for waste, and retains a valid subsisting interest in the property protected by A.R.S. § 12-1251 once entitled to possession.

ARTICLE V: REMAINDER / POSSESSION

Section 5.1 Possession on Death of Life Tenant

Upon the death of the Life Tenant, the reserved life estate ends and the remainder takes effect in possession (A.R.S. § 33-234). The person entitled to that share is determined under Section 5.2 if a named Remainderman has died. Probate of the Life Tenant's estate is not needed to transfer the interest already conveyed by this deed. Recording an Affidavit of Death of Life Tenant together with a certified copy of the death certificate with the County Recorder is recommended to clear title of record.

Section 5.2 If a Remainderman Predeceases the Life Tenant

If any individual Remainderman dies before the Life Tenant, that Remainderman's share shall pass as follows (select ONE):

☐ To that Remainderman's issue (descendants), per stirpes, as substitute takers directly under this deed; this share does not pass through the deceased Remainderman's estate; OR

☐ Through the deceased Remainderman's estate, under that person's will or the law of intestacy; no substitute gift is made under this deed; OR

☐ To the surviving Remainderman(en) in equal shares (a class gift with right of survivorship among the remaindermen); OR

☐ As otherwise specified: _____________________________________________

ARTICLE VI: WARRANTY ELECTION

Select ONE:

Section 6.1 ☐ OPTION A — Warranty (of the Remainder, Subject to the Life Estate)

GRANTOR warrants and will defend title to the remainder hereby conveyed, subject to the reserved life estate, unto the Remainderman, the Remainderman's heirs, successors, and assigns, against the lawful claims of all persons whomsoever.

Section 6.2 ☐ OPTION B — Special (Limited) Warranty

GRANTOR expressly warrants and will defend title to the remainder, subject to the reserved life estate, only against the lawful claims of all persons claiming by, through, or under GRANTOR, but not otherwise. This is an express limited warranty; A.R.S. § 33-435 itself implies only the prior-conveyance and no-encumbrance covenants stated in that section.

Section 6.3 ☐ OPTION C — Quitclaim (No Warranty)

GRANTOR conveys only such right, title, and interest as GRANTOR may have, WITHOUT ANY WARRANTY OF TITLE, express or implied. Notwithstanding the words used herein, no covenant under A.R.S. § 33-435 or otherwise shall be implied.

ARTICLE VII: LIMITATIONS ON ALIENATION (TRADITIONAL LIFE ESTATE)

Section 7.1 No Power to Convey or Encumber the Fee Alone

This is a traditional reserved life estate. Accordingly:

(a) The Life Tenant alone CANNOT convey, mortgage, encumber, or transfer fee simple title; the Life Tenant may convey or encumber only the Life Tenant's own life estate.

(b) The Remainderman alone CANNOT take possession during the Measuring Life; the Remainderman holds only the future (remainder) interest (A.R.S. § 33-204).

(c) To convey clear, marketable fee simple title during the Measuring Life, the Life Tenant and all Remainderman(en) must join in the deed.

(d) This deed reserves NO power in the Life Tenant to sell, mortgage, gift, convey, or revoke without the Remainderman's joinder — it is IRREVOCABLE. (Contrast: an enhanced life estate / "Lady Bird" deed and an A.R.S. § 33-405 beneficiary deed, both of which the owner may revoke.)

ARTICLE VIII: EXCEPTIONS AND RESERVATIONS

Section 8.1 Subject To

This conveyance is made subject to the following:

(a) Real property taxes and assessments for the current and subsequent years, not yet due and payable;

(b) All applicable zoning ordinances, building codes, and governmental regulations;

(c) All covenants, conditions, restrictions, reservations, rights, rights-of-way, and easements of record;

(d) All matters that would be disclosed by an accurate survey and inspection;

(e) Any existing mortgage, deed of trust, or lien of record;

(f) The following specific exceptions:

☐ None

☐ As set forth below:
_____________________________________________
_____________________________________________

Section 8.2 Community Property / Spousal Disclaimer

☐ If applicable: The undersigned spouse of Grantor joins in this deed for the purpose of releasing and relinquishing any community property interest, but is not a grantor of a separate estate hereunder.

ARTICLE IX: TAX AND MEDICAID NOTE

TAX, MEDICAID (AHCCCS/ALTCS), AND ESTATE-PLANNING NOTICE (NOT LEGAL OR TAX ADVICE).

• Medicaid 5-year lookback. Conveying the remainder is a transfer of an asset for Arizona long-term-care Medicaid (ALTCS) purposes. If the Life Tenant applies within five (5) years of recording, the transfer of the remainder's value may trigger a transfer-penalty (ineligibility) period. The retained life estate itself is generally not a countable resource while the Life Tenant lives.
• Estate inclusion and basis (26 U.S.C. §§ 2036, 1014). If the Grantor retains a life estate, § 2036 generally includes the affected interest in the Grantor's gross estate at the Grantor's death, subject to the statute's sale exception. A life estate granted to a different person does not by itself establish a retained Grantor interest under § 2036. Section 1014 separately governs a Remainderman's basis when property passes from a decedent; obtain transaction-specific tax advice.
• Federal gift tax on the remainder (26 U.S.C. §§ 2501, 2702; Form 709). Conveying the remainder is a completed gift of the remainder interest, valued as the property's value reduced by the actuarial value of the retained life estate under IRS valuation tables (note § 2702 may, in family transfers, value the retained interest at zero so the whole value is treated as the gift). A completed gift of the future remainder generally requires IRS Form 709 regardless of value because the annual exclusion does not apply to future interests.

Consult an elder-law/Medicaid attorney and a CPA before recording this deed.

ARTICLE X: TRANSFER-TAX / AFFIDAVIT OF PROPERTY VALUE DECLARATION

Section 10.1 No State Transfer Tax

Arizona Constitution article IX, § 24 bars the state, counties, and cities from imposing new taxes or similar charges on the sale or transfer of real property. Confirm the applicable recorder's fees for this deed; the constitutional rule preserves assessments that existed on December 31, 2007.

Section 10.2 Affidavit of Property Value Exemption (A.R.S. § 11-1134)

EXEMPTION CLAIMED. This instrument conveys a remainder interest for natural love and affection and no monetary consideration and is exempt from the Affidavit of Property Value and the associated filing fee pursuant to A.R.S. § 11-1134(A)(7) (a deed of gift) and, for a qualifying family transfer of residential property, A.R.S. § 11-1134(B)(3) (nominal consideration between, e.g., parent and child or grandparent and grandchild). Pursuant to A.R.S. § 11-1134(C), this exemption is noted on the face of the instrument and the specific exemption claimed is indicated.

Exemption Code (note on instrument at recording):
☐ B3 — Nominal consideration, residential transfer between qualifying family members
☐ A7 — Deed of gift
☐ Other (specify): _________________________

ARTICLE XI: EXECUTION

Section 11.1 Grantor's Signature

IN WITNESS WHEREOF, the Grantor(s) have executed this Life Estate Deed as of the date first written above.

GRANTOR(S):

_____________________________________________
Signature

_____________________________________________
Printed Name

Date: _____________________________________________

Named Life Tenant (if different from Grantor — joining to confirm reservation):

_____________________________________________
Signature

_____________________________________________
Printed Name

Date: _____________________________________________

Spouse (if joining for community property release):

_____________________________________________
Signature

_____________________________________________
Printed Name

Date: _____________________________________________

ARTICLE XII: ACKNOWLEDGMENT

Section 12.1 Arizona Acknowledgment (Individual)

STATE OF ARIZONA
COUNTY OF _________________

On this _____ day of _________________, 20_____, before me, the undersigned Notary Public, personally appeared:

_____________________________________________

☐ personally known to me, OR
☐ proved to me on the basis of satisfactory evidence

to be the person(s) whose name(s) is/are subscribed to the within instrument, and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument, the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

WITNESS my hand and official seal.

_____________________________________________
Notary Public Signature

_____________________________________________
Printed Name of Notary

My Commission Expires: _____________________________________________

[NOTARIAL SEAL]

Section 12.2 Arizona Acknowledgment (Entity)

STATE OF ARIZONA
COUNTY OF _________________

On this _____ day of _________________, 20_____, before me, the undersigned Notary Public, personally appeared:

_____________________________________________

as _________________________ [title] of _________________________ [entity name],

☐ personally known to me, OR
☐ proved to me on the basis of satisfactory evidence

to be the person whose name is subscribed to the within instrument, and acknowledged to me that he/she executed the same in his/her authorized capacity as the duly authorized representative of said entity.

WITNESS my hand and official seal.

_____________________________________________
Notary Public Signature

_____________________________________________
Printed Name of Notary

My Commission Expires: _____________________________________________

[NOTARIAL SEAL]

EXHIBITS

EXHIBIT A - LEGAL DESCRIPTION

Legal Description of Property:

_____________________________________________
_____________________________________________
_____________________________________________
_____________________________________________
_____________________________________________

Source of Title: Book _______, Page _______, or Document No. _______________, Official Records of _________________ County, Arizona.

ARIZONA RECORDING REQUIREMENTS AND INFORMATION

Recording Requirements

Important Arizona Notes

1. Traditional vs. Lady Bird / Beneficiary Deed. This deed is a traditional, irrevocable reserved life estate. The life tenant cannot sell, mortgage, or revoke without the remainderman joining. For a revocable transfer, use the Enhanced Life Estate / Lady Bird Deed or the A.R.S. § 33-405 Beneficiary Deed.

2. Remainder takes effect at death (A.R.S. §§ 33-204, 33-234). The future estate (remainder) vests in possession only on the Life Tenant's death.

3. Affidavit of Property Value exemption. A deed of gift / nominal family transfer is exempt; note the exemption on the face of the deed (A.R.S. § 11-1134(C)).

4. Constructive Notice: Recording provides constructive notice (A.R.S. § 33-411).

5. Medicaid & basis. The remainder transfer starts the 5-year ALTCS lookback; the retained life estate generally yields a § 1014 step-up via § 2036 inclusion. Confirm with counsel.

6. Legal Counsel: Consultation with a licensed Arizona elder-law/real-estate attorney is recommended.

PREPARED BY:

_____________________________________________
Name

_____________________________________________
Address

_____________________________________________
Phone/Email

_____________________________________________
Arizona Bar Number (if applicable)

SOURCES AND REFERENCES

• A.R.S. § 33-204 (estates in expectancy; remainders) — https://codes.findlaw.com/az/title-33-property/az-rev-st-sect-33-204/
• A.R.S. § 33-234 (remainder on life estate takes effect at death) — https://codes.findlaw.com/az/title-33-property/az-rev-st-sect-33-234/
• A.R.S. § 33-401 / § 33-402 (conveyances; forms) — https://www.azleg.gov/ars/33/00401.htm
• A.R.S. § 11-1134 (Affidavit of Property Value exemptions) — https://www.azleg.gov/ars/11/01134.htm
• A.R.S. § 12-1251 (recovery of real property) — https://www.azleg.gov/ars/12/01251.htm
• IRS, Estate and Gift Tax (Form 709; valuation tables) — https://www.irs.gov/businesses/small-businesses-self-employed/whats-new-estate-and-gift-tax
• 26 U.S.C. §§ 2036, 1014, 2501, 2702 (retained life estate inclusion; basis step-up; gift tax; special valuation)

This template is provided for informational purposes only and does not constitute legal advice. Consult with a licensed Arizona attorney before using this form.