May 18, 2026
One of the most common questions clients ask during the estate planning process is:
“Will my heirs have to pay estate taxes when I die?”
Understanding estate taxes and estate administration in Indiana can bring clarity—and peace of mind.
At Bennett Boehning and Clary, LLP (BB&C), we guide families through both estate planning and estate administration with care and precision. We are here for you and here for life.
Indiana Estate Taxes and Inheritance Taxes
Indiana residents often worry about state death taxes. Fortunately:
- Indiana does not have an estate tax
- Indiana does not have an inheritance tax
Indiana’s inheritance tax was fully repealed for deaths occurring after January 1, 2013. For most Hoosier families, no state-level tax is owed during estate administration.
Federal Estate Tax: Who Is Affected?
The federal estate tax applies only to estates that exceed a specific exemption amount. As of January 1, 2026, the exemption equals $15 million per individual, and married couples can effectively double that amount with proper planning (i.e. $30 million per couple).
Most estates in Indiana:
- Do not owe federal estate tax
- Still require proper estate administration
However, estates that include substantial assets—such as real estate, farms, closely held businesses, or investment portfolios—may benefit from advanced estate tax planning.
Estate Taxes vs. Income Taxes During Estate Administration
Even when no estate tax is due, heirs may still face income tax consequences, including:
- Taxation of inherited retirement accounts
- Capital gains taxes upon sale of inherited assets
- Trust and estate income taxes
Understanding these distinctions is a critical part of effective Indiana estate administration.
How Estate Planning Can Minimize Taxes and Burdens
Proper estate planning can:
- Reduce or eliminate estate taxes
- Simplify the probate and administration process
- Protect heirs from unnecessary expenses and delays
Common tools include trusts, beneficiary designations, charitable planning, and coordinated tax strategies.
Planning Ahead Brings Peace of Mind
Estate administration can be stressful for surviving family members. Clear planning minimizes confusion and allows loved ones to focus on healing rather than legal complications.
At BB&C, we help clients plan today so their families are protected tomorrow. Whether you are creating an estate plan or serving as a personal representative, we are here for you and here for life.
Frequently Asked Questions About Indiana Estate Taxes
Does Indiana have an estate tax?
No. Indiana does not have a state estate tax or inheritance tax for deaths occurring after January 1, 2013.
Do most Indiana estates pay federal estate tax?
No. Most estates fall below the federal estate tax exemption, which is $15 million per individual as of January 1, 2026.
Will my heirs pay taxes on inherited assets?
While estate taxes may not apply, heirs may still owe income taxes on accounts or capital gains when inherited assets are sold.
Does having a will avoid estate taxes?
A will alone does not eliminate estate taxes. Proper estate planning, including trusts and tax strategies, is required to minimize tax exposure.
