Detailed Answer
Under Ohio law, a life estate gives a person (called the life tenant) the right to possess, use, and earn income from property for the duration of their life. When a will creates a life estate, it also names a remainderman who will receive full ownership when the life tenant dies. Key features include:
- Right of Possession and Use: The life tenant may live on or use the property exclusively. They control access and enjoy all benefits of ownership except the right to permanently transfer the title.
- Right to Income: The life tenant may collect rents, royalties, dividends or other profits generated by the property.
- Duty to Maintain and Pay Taxes: Ohio courts require the life tenant to keep the property in reasonable repair and pay real estate taxes and insurance. Failure to do so may expose the life tenant to claims for waste or removal by remainder holders. See Ohio Rev. Code § 5302.19 (https://codes.ohio.gov/ohio-revised-code/section-5302.19).
- Prohibition on Waste: The life tenant cannot commit voluntary waste (e.g., tearing down buildings) or permissive waste (neglecting maintenance). They must preserve the property’s value for the remainderman.
Remainder Interest
A remainder interest is the future right to full ownership once the life tenant dies. Under Ohio law, a remainder can be:
- Vested Remainder: The remainderman is identified and no condition (other than the life tenant’s death) must occur. They have an assured interest, though they cannot exercise possession until the life tenant’s death.
- Contingent Remainder: The remainderman’s identity or right depends on a condition—such as surviving the life tenant or reaching a certain age.
If a remainderman predeceases the life tenant, Ohio’s lapse and anti-lapse statutes may apply. R.C. 2105.06 (https://codes.ohio.gov/ohio-revised-code/section-2105.06) and R.C. 2105.13 help determine whether the interest passes to the remainderman’s heirs or falls into residue.
Helpful Hints
- Record the life estate deed promptly to protect the life tenant’s and remainderman’s interests.
- Keep detailed records of expenses and income related to the property for tax purposes and potential accounting.
- Obtain adequate insurance and pay property taxes on time to avoid liens or claims of waste.
- Review the will and deed periodically, especially if family circumstances change.
- Consult a local probate or real estate attorney to draft clear language and anticipate potential disputes.