Indiana Estate Planning Considerations
Indiana is a Common Law State, which means the rules governing the ownership, division, and inheritance of income and property acquired by a husband or wife during their marriage hold that subject to various qualifications, each spouse owns and has complete control over their own her income and property.
Last Will and Testament
The minimum age of a person competent to make a will is 18. Someone younger than 18 can make a will if he or she is a member of the armed forces or a merchant marine.
The number of witnesses necessary to execute a will is two.
Uniform Transfers to Minors Act (UTMA)
The custodial arrangement terminates when:
- The minor child reaches age 21, or
- The minor child dies.
Dying without a Last Will, the Indiana laws of Intestacy
The estate goes to the surviving spouse, as follows:
- If there are no surviving descendants or parents, —100% of the estate
- If there is a surviving child or descendant of a child—50% of the estate
- If the spouse is a second or other subsequent spouses who had no children by the decedent, and the decedent left one or more surviving children or descendants, the spouse takes 25% of the fair market value (net) of the real property (but receives the same share of personal property as surviving spouses generally)
If there is no surviving descendant, but one or both parents survive, —75% of the estate
If there is no surviving spouse, or if a portion of the estate does not go to the spouse:
- 100% (or applicable portion) of the estate goes to surviving descendants by representation. The Indiana statute does not explicitly define
On May 11, 2013, Governor Pence signed HB 1001, which repealed Indiana’s inheritance tax retroactively to January 1, 2013. This replaced Indiana’s prior law enacted in 2012, which phased out Indiana’s inheritance tax over nine years beginning in 2013 and ending on December 31, 2021. Increased the inheritance tax exemption amounts retroactive to January 1, 2012.
Indiana does not impose an inheritance tax.
Credit Estate Tax
Indiana imposes an estate tax equal to the maximum credit allowed under IRC Sec. 2011 for paid state estate and inheritance taxes. However, since the current federal tax code does not permit a credit for paid state estate or inheritance taxes, there is no credit estate tax in effect at this time.
Generation-Skipping Transfer Tax (GST Tax)
Indiana imposes a GST tax equal to the maximum credit allowed under IRC Sec. 2604 for paid state GST tax.
Indiana does not impose a gift tax.