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Indiana Estate Planning Basics
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Indiana Estate Planning Basics

Indiana estate planning basics: the will, durable power of attorney, health care advance directive, and living trust most adults need, plus probate and taxes.

By Settled Editorial

Estate planning in Indiana comes down to a short set of documents that decide who inherits your property, who settles your estate, and who acts for you if you cannot act for yourself. Most adults need three: a will, a durable financial power of attorney, and a health care advance directive. Many people add a revocable living trust on top.

This guide is the plain-language map. It walks through each document, how Indiana probate works, the small-estate shortcut, the state tax picture, and who inherits when there is no will. Each Indiana guide linked below goes deeper on one topic.

Use this page as a planning map, not as advice for your situation. Indiana courts apply these statutes to the facts of each estate, and one signing mistake can put a document at risk. When real estate, a blended family, or a possible dispute is involved, confirm your plan with a licensed Indiana attorney before you sign.

Why a Plan Matters in Indiana

Here is what a plan does for you and your family:

  • You choose who inherits, instead of leaving it to a statute.
  • You name the person who settles your estate and the person who raises your minor children.
  • You name someone to manage your money and your medical care if you cannot.
  • You can keep your family out of a guardianship case and shorten the work after death.

Without a plan, Indiana law fills the gaps. The intestacy statute in IC 29-1-2 decides who inherits. A court may appoint a guardian under IC 29-3 to manage your care and finances during incapacity. Your family carries more cost, delay, and worry than they need to.

The Three Documents Most Indiana Adults Need

1. Last Will and Testament

A will is the anchor of most Indiana plans. It names who receives your probate property, names a personal representative (executor) to settle the estate, and nominates a guardian for your minor children, which the probate court weighs when it appoints one under IC 29-3. It can also set up a trust for a young or vulnerable heir.

Indiana keeps its will rules in IC 29-1-5:

  • The maker must be of sound mind and at least 18, or younger and serving in the armed forces or the merchant marine (IC 29-1-5-1).
  • The will must be in writing, signed by the testator (or by another person at the testator's direction and in the testator's presence), and attested by at least two witnesses who sign in the presence of the testator and of each other (IC 29-1-5-3).
  • A will can be made self-proved with a signed clause under IC 29-1-5-3.1 so the witnesses do not have to appear at probate, and no notary is required for validity.
  • Indiana does not accept an unwitnessed handwritten (holographic) will. Since 2018 it does allow an electronic will under a separate statute (IC 29-1-21).

The two-witness rule, with both witnesses signing together, is the part that sinks homemade wills, so read the Indiana will requirements guide before you sign. A will does not avoid probate and does nothing during incapacity, which is why it works alongside the documents below. For the guardian side, see the Indiana guardianship planning guide.

2. Durable Financial Power of Attorney

A financial power of attorney lets a person you trust, your attorney in fact, handle money matters if you cannot. That covers banking, bills, real estate, taxes, and benefits. Without one, your family may have to ask a court to appoint a guardian of the estate, which costs time and money.

Indiana wrote its own act, IC 30-5, instead of adopting the Uniform Power of Attorney Act, and two points catch people off guard:

  • An Indiana power of attorney is durable by default. Under IC 30-5-10-3, it is not terminated by your later incapacity unless the document itself says so. You sign it before a notary public or at least two attesting witnesses (IC 30-5-4-1).
  • The attorney in fact holds only the powers the document lists or cites. Under IC 30-5-5-1, a cataloged power such as making gifts, changing beneficiary designations, or managing retirement accounts applies only when the document incorporates it. A general grant alone does not reach those.

Since January 1, 2023, an Indiana power of attorney can no longer carry health care powers, so medical decisions run through the advance directive below (IC 30-5-5-16). The Indiana power of attorney guide walks through drafting choices, the three-business-day acceptance rule for banks, and how the document ends.

3. Health Care Advance Directive

Indiana folded its medical documents into one. Under the Health Care Advance Directives Act, IC 16-36-7, a single written advance directive names a health care representative to speak for you and records your treatment wishes. You sign it before two adult witnesses or a notary, whichever you prefer, and no official form is required (IC 16-36-7-28).

Two Indiana points deserve attention. First, once your treating physician finds that you cannot decide, your representative's choice carries the same force as your own would. Second, if you never sign a directive, decisions pass down a ten-step proxy ladder that starts with a court-appointed guardian and your spouse, so your care follows a default ranking instead of your chosen person. Naming your own representative keeps the choice with you. The Indiana health care directive guide covers the signing rules, the older living will, and DNR and POST orders.

Should You Add a Revocable Living Trust?

A revocable living trust holds your assets during life and passes whatever it owns at death without probate. You stay in control as trustee while you are able, and a successor trustee steps in at incapacity or death. Indiana trusts follow the Indiana Trust Code, IC 30-4, and any trust created after June 30, 2005 is revocable unless its terms expressly say otherwise (IC 30-4-3-1.5). The Indiana revocable living trust guide covers what the document does, how to fund it, and the pour-over will that backs it up.

A trust is not required, and many Indiana estates settle fine without one. It earns its cost when you own out-of-state real estate, want privacy, want smooth management if you become incapacitated, or have a blended family. A trust only works once you retitle assets into it, a step planners call funding, so an empty trust does nothing. Indiana also gives real estate its own probate-skipping tool: a transfer on death deed under IC 32-17-14-11 lets you name who receives a property at your death, recorded now and revocable while you live. The Indiana probate avoidance guide gathers each tool in one place, the Indiana transfer on death deed guide covers the deed, and the national revocable living trust overview and will vs trust guide weigh the trust route against plain probate.

How Probate Works in Indiana

Probate in Indiana is the court process of proving a will, appointing a personal representative, paying debts and taxes, and distributing what is left. Indiana has no standalone statewide probate court. Estates open in the circuit or superior court with probate jurisdiction in the county where the person lived, through the clerk of the circuit court. The shape is:

  • The personal representative named in the will, or an administrator if there is no will, petitions the court for letters and receives letters testamentary (with a will) or letters of administration (without one).
  • The court issues those letters, which prove the representative's authority to banks and others.
  • The estate inventories assets, pays valid creditor claims, files final tax returns, and distributes the rest to heirs or beneficiaries.

Only probate property runs through this process. Assets with a named beneficiary, a payable-on-death or transfer-on-death registration, survivorship rights, a recorded transfer on death deed, or trust ownership usually pass outside probate. The Indiana probate guide walks the steps, the Indiana executor duties guide covers the representative's job, and the Indiana creditor claims guide explains the claim windows.

Indiana's $100,000 Small-Estate Shortcut

Indiana lets a smaller estate skip full administration. Under IC 29-1-8-1, a distributee can collect a decedent's personal property with a sworn affidavit when the gross probate estate, less liens, encumbrances, and reasonable funeral expenses, does not exceed $100,000 for deaths after June 30, 2022, at least 45 days have passed since the death, and no personal representative is pending or appointed. The threshold was $50,000 for deaths before July 1, 2022, a stale figure still live on many pages. Larger estates near or above the line usually need a supervised or unsupervised administration through the circuit or superior court. The Indiana probate avoidance guide explains the affidavit path and when a full estate is the better route.

Does Indiana Have an Estate or Inheritance Tax?

Here is the good news. Indiana has no state estate tax and no inheritance tax. The legislature repealed the Indiana inheritance tax for anyone who dies after December 31, 2012, and the Department of Revenue confirms no inheritance tax is owed and no returns are filed. No beneficiary owes an Indiana death tax.

A few taxes can still touch an estate:

  • The person who died may owe a final Indiana and federal income tax return, and estate income during administration can call for a fiduciary return (federal Form 1041).
  • Federal estate tax reaches only very large estates. The federal exclusion is $15 million per person for deaths in 2026, per the IRS, so almost every estate owes nothing.

The costs of opening an Indiana estate are court costs, publication, and recording fees, not a tax on the estate's value. The court allows the personal representative and the estate attorney compensation it finds just and reasonable under IC 29-1-10-13, since Indiana has no statutory percentage schedule.

Who Inherits If You Have No Will

If you die without a valid will, Indiana's intestacy statute decides who inherits your probate property. The main rules in IC 29-1-2-1 work like this:

  • The surviving spouse takes one-half of the net estate when the decedent left children or their descendants. The children divide the other half.
  • The surviving spouse takes three-fourths when there are no descendants but a parent survives, and the parent or parents take the remaining fourth.
  • The surviving spouse takes the entire net estate when there is no surviving descendant and no surviving parent.

Indiana adds a rule most states do not have. A second or subsequent spouse who never had children with the decedent, where the decedent left children from a previous spouse, does not take an ownership share of the decedent's real estate. That spouse instead receives an amount equal to 25 percent of the fair market value of the land, minus liens, while title vests in the decedent's children (IC 29-1-2-1(c)). Stepchildren do not inherit unless adopted, and unmarried partners inherit nothing under intestacy. A will or trust replaces these defaults with your own choices. The Indiana intestate succession guide shows how each family situation plays out.

A surviving spouse also has protections beyond the intestate share. The spouse can claim the $25,000 survivor's allowance under IC 29-1-4-1, and the allowance does not count against the spouse's distributive share. The Indiana family allowance guide covers who can claim it and against which property.

How These Documents Work Together

Each document covers a different moment, and they act as a set:

  • The durable power of attorney and the health care advance directive protect you while you are alive but unable to act.
  • The will and any revocable living trust direct your property after death.
  • A guardian nominated in your will protects your minor children, and planning ahead with the incapacity documents can keep you out of an adult guardianship case under IC 29-3.

Beneficiary designations on life insurance, retirement accounts, and bank accounts sit beside all of this. They pass outside your will, so review them after every marriage, divorce, birth, or death. Outdated beneficiaries are one of the most common ways a careful plan goes wrong.

If an animal depends on you, add one more piece. Indiana allows a trust for the care of an animal alive during your lifetime, funded and managed by a trustee you name. The Indiana pet trust guide covers how to set the funding at a figure a court will leave alone.

Getting Started

You do not have to do it all at once. A sensible order looks like this:

  1. List what you own and roughly what it is worth.
  2. Decide who should inherit, who should settle your estate, who should raise your children, and who should be your financial and medical agents.
  3. Sign the documents: a will, a durable financial power of attorney, and a health care advance directive.
  4. Check the beneficiary designations on your accounts and insurance.
  5. Tell your personal representative and agents where the documents are.
  6. Review the plan every few years and after any major life change.

For the wider picture across states, the national estate planning overview shows how these pieces connect. For the local court path, start at the Indiana probate guide or the Indiana county probate directory.

The Bottom Line

Most Indiana adults need three documents: a will, a durable financial power of attorney, and a health care advance directive. Add a revocable living trust when your situation calls for one, and use a transfer on death deed to pass real estate outside probate. Indiana runs probate through the circuit or superior court in each county, offers a $100,000 small-estate shortcut, and charges no state estate or inheritance tax. Sign the documents while you are healthy, keep your beneficiaries current, and revisit the plan as life changes.

This guide is general information about Indiana estate planning, not advice for your situation. Confirm anything that affects your estate with a licensed Indiana attorney or the circuit or superior court in your county before you sign or rely on a document.

Sources:

It is not legal advice.

Prefer to talk it through? Connect with an estate-planning attorney

Settled Estate is not a law firm and does not give legal advice.

Information current as of July 18, 2026

Settled Estate is not a law firm, and this content is for informational purposes only and does not constitute legal advice. Probate laws and procedures in Indiana can change. Consult with a qualified attorney for advice specific to your situation. Full disclaimer.

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