Reincarnation

Reincarnation enables players to leverage their existing progress with one of their current Player Characters, and allows players to change certain decisions made in that character's advancement, like a respec, in the case of Lesser and Greater Reincarnation, or to create an all-new more powerful hero, in the case of True Reincarnation.

All reincarnated characters will retain the name and items from the previous character incarnation. Characters go through the Character Creation Menu, as when they started, and then they go on to a flying ship. There they speak to a historian, and go through a menu for their changes. If they are changing their classes (Lesser Heart +1, etc.), they have to immediately make that selection as they level up, or else they are stuck with their previous classes. Then they can level up to their current status.

Since update 11, experience, guild experience, crafting experience (Bug) , loot boost potions carry over through reincarnation.

How To Reincarnate
In order to reincarnate, you'll need to speak with Life-Shaper in Halls of Heroes (NPC Kruz the Reincarnation Trainer in House Jorasco has been discontinued as of Update 20). He requires a certain type of "Hearts of Wood" in order to reincarnate you.
 * All Hearts of Wood can be purchased in the DDO Store.
 * Heroic True Hearts of Wood for Heroic True Reincarnation can also be earned by trading Token of the Twelve.
 * Iconic True and Epic Hearts of Wood can also be earned by trading Commendation of Valor.

Quick summary
'Yes' indicates that item is reset by reincarnating.

1 - Wizards and Artificers will keep their spell books. They will not be able to select new/different spells leveling up, any additional spells desired will need to be learned through scrolls. All other spell casting classes will get to re-select spells. There is an exception for True Reincarnation - spell books will be fully reset if you TR. 2 - Due to Drow racial inherent stat bonuses, reincarnations into Drow will only yield 30 point builds on first reincarnation (32 on 2nd or higher).

Developer quote

 * Recent update notes: This now applies to all forms of reincarnation. +4 tomes will apply at level 15 and +5 tomes will apply at level 19. See Tomes for more information.