INDIANA WILLS AND TRUSTS REQUIREMENTS
Statutory Authority.
Wills:ย Indiana Probate Code (Ind. Code, Tit. 29, Art. 1; Ind. Code ยงยง29-1-1-0.1, et. seq.).
Trusts:ย Indiana Trust Code (Ind. Code, Tit. 30, Art. 4; Ind. Code ยงยง30-4-2-1, et. seq.).
Indiana Will Requirements.
Anyone who is at least 18 years old and of sound mind can make a will in Indiana.ย Additionally, individuals who are under age 18 and are members of the armed forces or merchant marine can also form a valid Indiana will.ย
To constitute a valid will, a document must be in writing and signed by the testator and two witnesses.ย The witnesses must either observe the testator sign the will, observe the testator authorize someone to sign for the testator, or hear the testator declare that the signature is genuine. The signature of each witness must be observed by the testator and by the other witness.ย ย
In general, Indiana courts interpret the statutory requirements for wills in favor of finding that a document is a valid will.
An Indiana will witnessed by an interested party (i.e., someone who receives a personal and beneficial interest under the will) is not invalid as a whole, but provisions to the interested witness are void.ย An interested witness can receive a share of the estate up to the value he or she would have received had the testator not had a willโexcept that the share cannot exceed what the interested witness would have received under the terms of the will.
Although notarization is not necessary for an Indiana will to be an effective testamentary document, Indiana law allows a will to be โself-provedโ if it includes a self-proving clause or an affidavit with a self-proving clause is attached to the will.ย When present, a self-proving clause or affidavit serves as evidence of the willโs authenticity and allows for admission in probate without further witness testimony.ย
A self-proving clause is attested by both witnesses and the testator.ย It states that the testator, while of sound mind and legal age, freely and voluntarily signed or acknowledged his/her signature in the witnessesโ presence with the intent to create a valid will. It further states that the witnesses signed the will as witnesses in the presence of the testator and each other.
Indiana law also allows the use of videotape as evidence of a willโs authenticity and proper execution, the testatorโs capacity and intent when making the will, and any other matters a probate court decides are relevant when reviewing the will.
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Amendment, Revision, and Revocation of Indiana Wills.
An Indiana will may be revoked through physical destruction or mutilation of the document with the intent that it be revoked.ย Or, a will may be revoked by execution of a separate written instrument which states the testatorโs intent to revoke the will and satisfies the formalities required for creation of a will.ย Under Indiana law, a partial revocation of an existing will can only be accomplished by creating a subsequent writing that meets the required formalities.ย ย
Indiana wills may be amended or revised through execution of a codicil (an addendum to an existing will).ย To effectively amend a will, a codicil must satisfy all legal requirements applicable to the creation of a will.ย The terms of a will may also be amended by executing a later will which revokes the prior will and includes the revised terms.
If an Indiana testator divorces after executing a will or revocable trust, any provisions in the will or trust in favor of the former spouse are deemed to have been revoked, and the will or trust is interpreted as if the former spouse had predeceased the testator or settlor.
If a child is born to or adopted by a testator after execution of a willโand if the testatorโs will does not provide for or appear to intentionally omit the childโthe child inherits the same share of the estate the child would have inherited had the testator died intestate.ย However, an afterborn child does not receive an intestate share if the testator had at least one other child when making the will and left substantially all of the estate to a surviving spouse.
Holographic and Oral Wills.
Indiana law does not recognize holographic (or handwritten) wills.ย A will written in the testatorโs handwriting must satisfy all other requirements for creation of a valid will to be admissible in probate.
Indiana recognizes oral (or โnuncupativeโ) wills under limited circumstances.ย The testator must make the statements while in imminent peril of death (including by sickness) from which the testator does not survive.ย A testatorโs declaration of an oral will must be heard by two witnesses, reduced to writing by a witness within 30 days of the statements, and submitted for probate within six months of the testatorโs death.
Indiana nuncupative wills are only effective for dispositions of personal propertyโand only property valued up to $1,000 (increased to $10,000 for active servicemembers during time of war).ย ย
Indiana Trust Requirements.
When creating an Indiana trust, the settlor must have adequate legal capacity.ย For revocable trusts, capacity is determined under the same standard applicable to wills.ย To create an irrevocable trust and direct the actions of the trustee, the settlor must be of sound mind, capable of understanding the nature and effect of the trust, at least 18 years old, and capable of holding or dealing with property.
Under Indiana law, a trust is only valid and enforceable if it is evidenced by a written instrument signed by the settlor or the settlorโs authorized agent.ย However, an inter vivos trust created for testamentary purposes need not satisfy all requirements for creation of an Indiana will.ย A trust instrument must identify with reasonable certainty the property subject to the trust, the trusteeโs and beneficiariesโ identities, the nature of the interests held by the trustee and beneficiaries, and the trustโs purpose.ย Trust property can be limited to a trusteeโs right to receive future property or proceeds without invalidating an Indiana trust.
Trustees must be at least 18 years old, of sound mind, and of good moral character.ย A trustee may also be a corporation capable of dealing with property on its own and empowered to act as a trustee.ย The trustee of an Indiana trust must have actual powers or duties relating to trust property.ย Any power or duty which requires a trustee to commit an act which is criminal, tortious, or contrary to public policy is invalid.ย If a trustee invests trust property, the trustee must do so in a prudent manner, with due consideration to the trustโs purposes, terms, and circumstances.
Under Indiana law, a trustโs sole trustee with full legal title to trust property and the trustโs sole beneficiary with all equitable interests cannot be the same person.ย If one individual becomes both sole trustee and sole beneficiary of an existing Indiana trust, the trust terminates, and trust property is deemed to be the property of that individual.ย
Although an Indiana trust must have an identifiable beneficiary, Indiana law allows the beneficiary to be an animal, an individual to be ascertained in the future, or someone a trustee is empowered to select from among an indefinite class.
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Essential Legal Protection for AchieversSpecial Considerations.
Estate Taxes: Indiana does not impose any state-level estate tax.ย Large Indiana estates may still qualify for the federal estate tax.ย Indiana also does not have an inheritance tax.
Simplified Probate:ย Indiana law provides a streamlined probate process for โsmall estatesโ (defined as under $50,000).ย If an estate qualifies, the personal representative can distribute estate assets without going through the ordinary, full probate process.ย Simplified probate generally allows for quicker, less expensive administration.
Non-Probate Transfers:ย Along with living trusts, Indiana law offers multiple other options for transfer of assets outside of probate.ย Assets co-owned as joint tenants with a right of survivorship automatically transfer to a surviving owner upon the other ownerโs death.ย Indiana also recognizes tenancy by the entireties, another joint ownership form that includes a right of survivorship.ย In Indiana, tenancy by the entireties can only be used for co-ownership of real estate by two spouses.ย ย
POD (payable-on-death) and TOD (transfer-on-death) designations, which provide for automatic transfer of an asset to a beneficiary upon an ownerโs death, can also be used in Indiana for many assets.ย For instance, POD designations can be added to financial accounts and CDs, and TOD designations can be used with assets like registered securities and brokerage accounts.ย ย
Similarly, some assetsโlike retirement accounts and life insuranceโallow owners to name a beneficiary who automatically takes ownership of the asset upon the original ownerโs death.
Transfer-on-Death (TOD) Deeds and Vehicle Titles:ย Indiana is one of the few states that recognize TOD designations on both real estate deeds and vehicle titles.ย In either case, an asset with a TOD designation automatically transfers to the named beneficiary upon the ownerโs death, but the beneficiary does not acquire present rights over the asset until death actually occurs.ย
Spousal Shares: Indiana law protects surviving spouses from disinheritance by guarantying a surviving spouse an elective share in a decedent spouseโs estate.ย The amount of the elective share is generally fifty percent.ย However, if the surviving spouse is not the decedentโs first spouse and the decedent left surviving children or grandchildren, the elective share is one-third of the value of personal property and one-fourth of the value of real estate.ย The right to an elective share can be waived through a prenuptial or marital agreement.
In intestate estates, the surviving spouse of an Indiana resident receives the entire net estate if the decedent leaves no surviving children or parents; one-half the net estate if the decedent is survived by a child or grandchild; or three-fourths if the decedent leaves a surviving parent but no children or grandchildren.ย If the surviving spouse is not the decedentโs first spouse, and the decedent spouse and surviving spouse had no children, and the decedent leaves other surviving children or grandchildren, the share is reduced to one-fourth the net value of the decedentโs real estate.
Creating a will or trust does not have to be difficult or intimidating.ย However, certain circumstancesโlike second marriages, stepchildren, aging parents, special needs beneficiaries, guardianships, and business interests (to name a few)โcan add a layer of complexity and result in unforeseen long-term consequences.ย Whenever any out-of-the-ordinary issues are present, itโs a good idea to consult with an experienced attorney familiar with and licensed under the laws of the relevant jurisdiction.
