Ladybird Deeds Are Stronger Than Ever in North Carolina

Attorney Greg McIntyre

Ladybird deeds have long been a powerful estate planning tool in North Carolina—but today, they are stronger and more clearly protected than ever before.

Recent updates to the North Carolina Long-Term Care Medicaid Manual (MA-2240) have officially codified the use of Ladybird deeds, removing lingering confusion and confirming what experienced elder law attorneys have known for years: Ladybird deeds do not violate Medicaid transfer rules and remain an effective way to protect the family home.

Lady Bird Deeds Now Codified in the Medicaid Manual

As of September, Ladybird deeds are expressly written into the North Carolina Long-Term Care Medicaid Manual, Section 10C.6. This is a major development for families concerned about protecting their home when facing the cost of long-term care, including:

Nursing home care
In-home care services
PACE and CAP benefits

The manual now clearly explains why Ladybird deeds are not considered a disqualifying transfer, even during Medicaid’s five-year look-back period.

Why a Lady Bird Deed is NOT a Medicaid Transfer

A Ladybird deed—also known as a life estate with enhanced powers—works by allowing the homeowner to:

Retain full ownership and control during their lifetime
Keep the power to sell, mortgage, or change the property
Automatically transfer the property to a named beneficiary at death

Because the life estate holder retains the power to sell the property, Medicaid does not consider this a transfer of value.

The Medicaid manual explicitly states:

The full equity value remains with the applicant
No asset has been given away
Therefore, no transfer penalty applies

This means a Ladybird deed does not violate Medicaid transfer rules, even if executed within the five-year look-back period.

The Homesite is an Exempt Asset

The manual does include language stating that the property’s value could be considered a countable resource—unless it is otherwise excluded.

This is where proper planning matters.

At McIntyre Elder Law, Ladybird deeds are used specifically for the primary residence, referred to in the manual as the home site. The home site is exempt when:

It is the applicant’s primary residence
The applicant has an intent to return home, which is filed with the Medicaid application

Because of this exemption, the home remains protected and is not counted against Medicaid eligibility.

Benefits of a Lady Bird Deed in North Carolina

Ladybird deeds offer multiple layers of protection and efficiency, including:

Passing the home outside of probate
Protecting the home from Medicaid estate recovery
Preserving family homes, farms, and primary residences
Allowing homeowners to maintain full control during life
Ensuring property passes directly to loved ones, such as children

Married couples can also use Ladybird deeds together, making them a flexible and effective tool for family planning.

Proven Results

Ladybird deeds are not theoretical—they work.

Through decades of advocacy, appeals, and hands-on representation, McIntyre Elder Law has helped shape how these deeds are treated at the state level. Earlier appeals cases helped lead to Ladybird deeds being written into the Special Assistance Manual for assisted living benefits. Now, they are fully codified for long-term care Medicaid as well.

As a result, millions upon millions of dollars in property value—homes, farms, and primary residences—have been preserved for families instead of being lost to long-term care costs.

Lady Bird Deeds Are Stronger Than Ever

There is no longer ambiguity. Ladybird deeds are:

Recognized
Codified
Stronger than ever in North Carolina

They remain one of the most powerful tools available to protect your home while planning for future care needs.

McIntyre Elder Law Can Help

If you are concerned about protecting your home or planning for long-term care, McIntyre Elder Law offers free consultations to discuss Ladybird deeds and other estate planning strategies.

📍 Offices in Shelby, Charlotte, and Hendersonville
📞 Call us at 1-888-999-6600
🌍 Visit our website: www.mcelderlaw.com

Don’t wait until it’s too late—take control of your future today!