As Indiana probate and trust lawyers, our clients often have many questions about the probate process, trusts, and related matters. Below are a number of the most frequently-asked questions.
Why avoid Probate?
People seek to avoid Probate through revocable living trusts in order to avoid the cost of administration and delays associated with formal Court proceedings. Often, they may also be interested in preserving some aspect of privacy with respect to the assets they own and their beneficiaries.
Are Living Trusts only for the wealthy?
No. Anyone can avoid the cost and delay of probate through the use of an affordable Living Trust. The savings increase with the size of the estate. Estates under $100,000.00, often prefer the simplicity of a Will. But Living Trusts are no longer just for the wealthy.
Why do young parents need a Will?
Reasons include naming a guardian for children and establishing a trust for their care. Without a will, state intestacy laws will determine how assets are distributed to children if their parents die, and a court will determine – without any input from parents – as to who such be awarded guardianship.
Who chooses the attorney to handle my affairs when I die?
The person named personal representative in your Will or the person named successor trustee in your Trust may choose any attorney (not just the attorney that drafted the Will or Trust) to assist with handling your affairs after you die.
How long does it take to administer an Estate?
As little as six months for a simple estate.
How much is the Indiana State Inheritance Tax?
In 2013 Indiana abolished state inheritance tax, so there is no longer a state inheritance tax for Indiana residents dying on or after January 1, 2013.
How much is the Federal Estate Tax?
There is no estate tax on transfer upon death between spouses. For other transfers, approximately the first $5 million value of an estate is not subject to tax (approximately $10 million for a couple). For large estates, the tax rate can exceed 40%.
Can I Avoid Federal or State Inheritance taxes through estate planning?
Yes, for large estates. Because there is no state estate tax in Indiana and there is no federal estate tax for approximately the first $5 million in an individual estate, estate planning for those with more modest estates is not necessary strictly from a tax perspective (although estate planning is still critical to accomplish asset transfer objectives and other objectives, such as providing for the future welfare of trust beneficiaries).
Does the State take my assets if I die without a Will?
Probably not. In the event that you die intestate (without a will) in Indiana, intestate law provides how your assets will be divided among your next of kin; however, it may not be divided the way you would have chosen (and, potentially, your assets could be distributed to distant relatives you may not even know). If there are no living relatives, then it is possible that your estate will go to the State of Indiana.
How can we avoid the nursing home taking all that we have saved and desire to leave to our children?
Medicaid Planning and Long Term Care Insurance are the best options. If a parent, spouse or friend are in need of skilled nursing home care, call us to discuss how we can help.
How does my will affect joint and pay on death accounts?
It doesn’t. Joint accounts and pay on death accounts with named beneficiaries, like 401K’s, IRA’s and annuities, pass directly to the survivor or beneficiary and are not transferred under the terms of the will.
If you have questions about probate, trusts, or any other matters for which our firm provides representation, please call us. We provide a no-obligation, no-cost initial consultation so that we can learn about your matter, and you can learn about our firm and the services we provide.