What You Need to Know About Indiana’s Inheritance Laws
As a resident of Indiana, you may wonder what laws dictate your inheritance. Here’s what you need to know about Indiana inheritance laws.
Indiana inheritance laws dictate how to manage an estate if there is a valid will and who is entitled to property if there is no outlined will. Indiana does not have its own inheritance or estate taxes. Instead, some Indiana residents may have to pay federal estate taxes.
Indiana Inheritance Taxes
Indiana has no state taxes on inheritance or estates of residents and non-residents with property in the area. However, individuals must file:
- Final individual federal and state income tax returns
- Federal estate/trust income tax returns
- Federal estate tax returns (only required of individual estates that exceed a gross asset and prior taxable gift value of $12.06 million and $24.12 for couples)
Inheritance Distribution in Indiana
For a will to be valid in Indiana, it must contain the deceased’s signature along with those of two witnesses. In Indiana, if you pass away without a will, intestate heirs include your spouse and family members. Through intestate, a court will split the property into real and personal property.
Real property includes land and homes, while personal property includes objects such as cars and heirlooms.
In Indiana, estates with assets equal to $50,000 or more must go through probate. Probate is when a court supervises the distribution of assets following an individual’s death.
Spousal Inheritance Laws in Indiana
A spouse will receive a portion of their deceased spouse’s estate. This portion varies depending on who else survived the deceased.
If the spouse and the deceased share a child, the spouse will receive half of the estate.
If the deceased has a child with a partner other than their spouse, the spouse will receive half of the deceased’s personal property and a quarter of their real property.
If the deceased is survived by their parents, a spouse will receive three-quarters of their estate.
Sibling Inheritance Laws in Indiana
If the deceased has siblings but no spouse, children, or parents, their siblings will inherit their estate.
If the deceased has no spouse or children but has siblings and parents, the siblings and parents will divide the estate into equal shares. Parents must receive at least one-quarter of intestate property.
Inheritance Rights of Children in Indiana
If a parent dies without a spouse, their children will split their estate.
If the deceased has a surviving spouse with whom they share a child, the child will receive half of the estate. If the spouse is not a parent to the child, the child will receive the remainder of the state after the spouse receives their combined real and personal property claim.
Assets Excluded from Inheritance Laws in Indiana
Certain assets may skip the probate process in Indiana since they have their own successors. These assets include:
- Life insurance
- Retirement accounts
- Transfer-on-death vehicles
- Transfer-on-death investments
- Transfer-on-death real estate
- Jointly-owned real estate
- Living trusts
- Pay-on-death bank accounts
FAQs About Indiana Inheritance Laws
If my daughter died, will my son-in-law inherit my estate in Indiana?
If you did not legally adopt your son-in-law, Indiana does not entitle them to your estate.
What if a spouse was cheating at the time of the deceased’s death in Indiana?
If Indiana discovers that a spouse was cheating or left at the time of their spouse’s death, they may lose their right to the estate.
As an adopted child, do I have a right to my parent’s estate in Indiana?
Both biological and adopted children have the same rights to their parent’s estate in Indiana.