life tenant

life tenant

A person entitled to the use of or the income from an asset during his or her lifetime. As an example, a person may stipulate in a will that all of his or her assets are to go to a charity but that the surviving spouse, designated as life tenant, is to have the use of the income from the deceased's estate for his or her lifetime, following which the remainder of the assets in the estate are to pass to the charity.

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Life Tenant

One who holds a life estate. A life tenant has all rights associated with ownership of real property, except the right to sell the property, until his/her (or someone else's) death. Upon the death of the life tenant, the property reverts back to the owner, or to a third party designated by the owner. For example, in a will, a farmer may grant ownership of his farm to his children, subject to the life estate of their mother. In this situation, the mother is the life tenant and has the right to live in the farm house for the rest of her life. A life tenancy may be included in one's gross estate.

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life tenant

One who has a life estate in a property, being the right to enjoy the property for a period of time measured by that person's life or some other designated person's life.The rest of the bundle of rights is called a reversion or remainder interest. Life tenants may sell, gift, or will their property to another, but when the defining life comes to an end, so do the rights of those other people.At that point,the remainderman may take possession of the property and enjoy it fully.

Example: Aunt Esther, who is 80 years old, sells her farm to Acme Agribusiness. She retains a life estate, measured by the life of her 40-year-old nephew, Mark. Esther dies two days later, with a will that leaves everything she owned to Texas A&M University. Mark has no rights in the property; he's just a measuring life. Texas A&M may use the farm until Mark's death, at which time it will pass to Acme Agribusiness.