Wills and Trusts in Indiana
Planning for the future is essential to ensure your assets are distributed according to your wishes and to provide security for your loved ones. By establishing a well-structured will or trust, you gain control over your estate, allowing you to specify beneficiaries, designate guardians for minor children, and potentially minimize taxes.
Many individuals mistakenly believe that estate planning is only necessary for the wealthy. However, regardless of the size of your estate, having a plan ensures that your assets are managed and distributed as you intend, reducing the potential for disputes among heirs.
The time to act is now. By consulting with an experienced estate planning attorney in Indiana, you can create a plan that reflects your unique circumstances and goals.
Wills vs. Trusts
A will is a legal document that outlines how your assets should be distributed after your death and allows you to designate guardians for minor children. In Indiana, a valid will must be in writing, signed by the testator, and witnessed by at least two competent individuals. The testator must be at least 18 years old and of sound mind.
A trust is a legal arrangement in which one party, known as the trustee, holds and manages assets on behalf of beneficiaries. Trusts offer greater flexibility and privacy than wills, as they can help assets bypass probate and be distributed more efficiently. Indiana law recognizes various types of trusts, each serving different financial and estate planning objectives.
How to Create a Will or Trust in Indiana
Identify Assets
The first step in estate planning is to take inventory of all your assets, including real estate, financial accounts, investments, and personal belongings. Keeping an organized record ensures that nothing is overlooked and that all assets are appropriately allocated in your estate plan.
Choose the Distribution
Deciding how to distribute your assets is another critical step. While a will allows you to specify how your estate should be divided, certain financial accounts—such as retirement plans and life insurance policies—pass directly to named beneficiaries. Reviewing and updating these designations is necessary to ensure alignment with your overall estate planning strategy.
Choose the Executor of your Indiana Will or Trust
Appointing an executor or trustee is an essential part of the process. In Indiana, the executor, also referred to as a personal representative, must be at least 18 years old and mentally competent. While many people choose a trusted family member, selecting a neutral third party, such as an attorney or financial professional, can ensure impartial management of the estate.
Choose a Guardian
If you have minor children, naming a guardian in your will is crucial. Without this designation, Indiana courts will decide who will take custody of your children, which may not reflect your wishes. Choosing a guardian in advance allows you to ensure your children will be raised by someone you trust.
Sign with Witnesses
Indiana law requires that a valid will be signed in the presence of two competent witnesses, who must also sign the document in the testator’s presence. Proper execution of these formalities prevents potential legal disputes and ensures the will is enforceable.
Update and Create your Will or Trust as Necessary
Estate planning is not a one-time process. Major life events—such as marriage, divorce, childbirth, or changes in financial status—may necessitate updates to your estate plan. Regularly reviewing and modifying your will or trust ensures that it accurately reflects your wishes over time.
Revoking a will begins with destroying the old one according to Indiana law. The current options include the following:
- Destroying or mutilating the will yourself with the intent to revoke
- Asking another person to destroy or mutilate the document with the intent to revoke
- Creating a new will that nullifies the previous one
The Different Types of Wills in Indiana
Simple Will
A simple will is the most common form of estate planning, outlining how assets should be distributed upon death. However, it does not bypass the probate process, which can be time-consuming and public. Individuals with uncomplicated estates may find this option sufficient.
Joint Will
A joint will is a document created by two people, usually spouses, dictating how their shared assets will be distributed. Although Indiana recognizes joint wills, they can become problematic if one spouse passes away and the surviving spouse wishes to make changes. As a result, separate wills with coordinated provisions often provide greater flexibility.
Living Will
A living will, also known as an advance healthcare directive, allows individuals to outline their medical treatment preferences in case they become incapacitated. This document ensures that healthcare providers and family members follow your wishes regarding end-of-life care.
Holographic Will
Indiana does not recognize holographic wills, which are handwritten and unwitnessed. To be valid, a will must adhere to the state’s legal requirements, including proper witnessing. Relying on an unwitnessed handwritten will can lead to complications in probate.
Pour-Over Will
A pour-over will works in conjunction with a living trust by ensuring that any assets not placed in the trust during the grantor’s lifetime are transferred into the trust upon death. This helps consolidate estate management and streamlines the asset distribution process.
The Different Types of Trusts in Indiana
Irrevocable Trust
An irrevocable trust provides asset protection and potential tax benefits, but once established, it cannot be modified or revoked without the consent of the beneficiaries. This type of trust is commonly used for Medicaid planning, protecting assets from creditors, and minimizing estate taxes.
Revocable Trust
A revocable living trust allows the grantor to retain control over the assets during their lifetime while ensuring a seamless transition upon death. Assets held in a revocable trust bypass probate, reducing court involvement and maintaining privacy. Many Indiana residents use revocable trusts as part of a comprehensive estate plan to simplify inheritance matters.
Family Trust
Many create this type of trust to provide for their loved ones after they’re gone. It ensures that children, siblings, or other family members receive their designated share of assets, offering peace of mind and financial security.
Charitable Trust
A charitable trust allows individuals to dedicate a portion of their estate to nonprofit organizations while potentially reducing their estate tax liability. These trusts can be structured in different ways, such as providing income to heirs for a set period before transferring the remaining assets to a charity.
How to Avoid Probate in Indiana
Avoiding probate can save time, reduce costs, and provide greater privacy. One of the most effective ways to bypass probate is by setting up a revocable living trust, which allows assets to pass directly to beneficiaries. Joint ownership with rights of survivorship also enables property to transfer automatically to a surviving co-owner.
Current Indiana law says that simple estates worth less than $50,000 only require an affidavit. A will and trust attorney may assist you with submitting this document to the court. But you may also wish to have their counsel for more complicated cases.
Work with an Experienced Indiana Estate Planning Will and Trust Attorney
Planning for your eventual death is not a pleasant task. Along the way, you are bound to wonder how wills and trusts work in Indiana? How can I make this process easier?
It is tedious, but it’s crucial to ensure that your family and legacy are secured. The law does not require an individual to hire a trust attorney or will lawyer, but they can prove invaluable if they catch issues that could result in your estate going to probate. If you feel like you need help, it’s worth your time to consider hiring an experienced estate planning attorney. We can even help you connect with legal help across Indiana state lines.
Submit a request or call us today at (866)-345-6784 to speak to a local will and trust attorney!
About the Author
Aaron is a professional legal writer with a B.S. in English Education from Southern Illinois University – Carbondale. He has written, published, and edited thousands of legal articles for RequestLegalHelp, which has connected over 5 million people to legal help in the United States.
With over five years of experience writing thousands of legal articles for law firms across the U.S. and Canada, Aaron specializes in covering federal, state, and city-level legal issues ranging from auto accidents to wrongful terminations.
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