Indiana Estate Planning in 2026: What Families Should Do Before the Federal Exemption Changes

Estate planning is not only for large estates. It is about putting trusted people in charge, protecting children, and moving assets with less stress and cost. For Hamilton County families in Westfield, Carmel, Fishers, and Noblesville, 2026 is a timely moment to review plans because federal rules are shifting. Those numbers influence how you title accounts, use trusts, and time larger gifts. The good news is that most Indiana families will not face a federal estate tax bill, but the details still matter for smooth transfers and long term security.

Indiana does not impose a state estate or inheritance tax today. Your focus is usually federal rules, plus practical steps that reduce avoidable probate work. That often means a current will, a revocable living trust when it fits, solid powers of attorney, and beneficiary designations that match your written plan. If you want a quick primer or to book a review, start with our Indiana Estate Planning Attorney page. If your questions involve a court process after a death, our Probate Attorney in Indiana page explains how that works and when to open an estate.

The federal estate tax exemption allows a person to transfer assets at death without federal estate tax. For 2025, the basic exclusion amount for estate tax is 13.99 million per person. 

Beginning on January 1, 2026, the federal estate tax exemption is set at 15 million per person and will continue to adjust for inflation. Married couples can combine exemptions with proper planning. 

What does that mean for a Hamilton County family? Most estates will remain below the federal threshold, but the exemption level still guides strategy. If your projected estate is near the federal estate tax limit, timing and structuring lifetime gifts in 2025 and 2026 can help you use the higher numbers well. If your estate is far below the exemption, you still want to optimize income tax results, keep the work simple for your family, and align beneficiary designations with your will and trust.

You do not have to solve this alone. If you are in or near Hamilton County, our Westfield office can meet with you to check documents and titles and to plan sensible steps that fit your life.

Not every household needs major changes, but certain situations deserve a closer look. Use this list to decide whether to schedule a planning review.

• Couples with a growing balance sheet. Add up real estate, retirement accounts, business values, and insurance. If your combined net worth approaches the federal limit, timing matters.  A short review can model both paths and show how they affect family goals.
• Business owners with an illiquid estate. A closely held company can push an estate above the limit on paper while cash is tied up in operations. A plan can provide liquidity to pay taxes if ever due and can prevent forced sales. It also brings order to successor voting, payroll, and client work if you are not available.
• Blended families and second marriages. Clear directions on what passes to a spouse and what passes to children reduce conflict. Trusts can provide income for a current spouse and preserve principal for children from a prior marriage.
• Families with a child or adult who has a disability. A special needs trust can protect eligibility for benefits while still providing for quality of life. If grandparents plan to help, align their gifts with the trust to avoid accidental harm.
• Charitably minded families. If you plan to give, timing and structure can improve income tax results and reduce the work your heirs must do later. Some families use donor advised funds, charitable bequests, or a mix of both.

If you expect a probate filing will be part of your picture after a death, our Bloomington office in Monroe County, Indiana, focuses on estate planning and probate and can coordinate with you now so later steps are clear.

Gifts are not only for the very wealthy. Even modest gifts can reduce future probate work, teach stewardship, and support children at the right moments. Here are common, practical options to discuss with your advisor.

• Annual exclusion gifts in 2025 and 2026. The annual gift tax exclusion lets you gift a set amount to any number of recipients without using your lifetime exemption. For 2025 the limit is $19,000 per person and it will adjust going forward. Gifting to children or grandchildren can fund education or a first home while keeping your future estate simpler.
• Education and medical payments. Tuition paid directly to a school and medical bills paid directly to a provider are not counted against the annual exclusion or the lifetime exemption. This is a simple way to help family without extra forms.
• Spousal lifetime access trust planning. Some couples create a trust for the benefit of one spouse and descendants. Properly drafted, this can move appreciating assets out of the taxable estate while keeping access to income if needed. Structure and trustee choice are important.
• Irrevocable life insurance trust funding. For families who may face a taxable estate someday, moving a policy into a life insurance trust can remove death benefits from the taxable estate and provide liquidity for taxes or family needs.
• 529 plan front loading. A 529 account can be front loaded with up to five years of annual exclusion amounts per beneficiary if reported correctly. This is useful for grandparents who want to see the impact of their help in real time.

Good gifting fits your values and your budget. Do not gift what you need for your own security. Test your plan on paper before you move dollars.

Documents and titles drive results. If your will or trust says one thing, but your beneficiary form or deed says another, the form or deed usually governs. That is why a periodic review is worth the time, especially in a year when federal numbers change.

Revocable living trust benefits in Indiana estate planning

A revocable living trust does not change your income taxes or protect assets from your creditors while you are alive, but it can make transfers faster and more private for your family. When funded correctly, a trust allows your successor trustee to pay bills, manage real estate, and distribute property without opening a full probate. It also lets you name backups and set clear rules for children who need time to grow into responsibility. If you want to see when a probate filing is still useful, this explainer can help: Probate Attorney in Indiana.

Beneficiary designations and POD or TOD accounts in Indiana estate planning

Retirement accounts and life insurance pass by beneficiary form. Bank and brokerage accounts can use payable on death or transfer on death designations. The right form can avoid probate and move assets quickly. The wrong form can undo part of your plan. Review every major account when you update your will or trust. If this is part of your plan, check for old or missing beneficiaries and make sure contingent beneficiaries are listed. If you need help aligning forms with your written plan, reach out through our Indiana Estate Planning Attorney page.

Special needs planning in Indiana estate planning

If a loved one receives means tested benefits, a special needs trust can hold gifts or inheritances so those benefits are not lost. Parents often include a letter of intent with personal details about routines, hobbies, and medical needs so future caregivers have a head start. Extended family should be told to direct any help to the trust.

Marital share planning and portability for Indiana estate planning 2026

Married couples have flexibility. You can rely on portability, which allows the survivor to use any unused federal exemption of the first spouse to die or you can use a trust structure that preserves control and potential growth outside the survivor’s estate. Your lawyer can explain the tradeoffs based on the size of your estate and your family goals.

Quick beneficiary and title check for Indiana estate planning

• Confirm primary and contingent beneficiaries on retirement accounts and life insurance and save copies of the forms with your estate binder.
• Check that any transfer on death deeds and payable on death designations list the right people and coincide with your trust terms if you use one.
• Review how your home, any rentals, and the family business are titled so your will or trust language can actually work as written.

Estate planning is about people first. It is about clarity, peace, and practical steps that make life easier for the ones you love. If you are in Hamilton County or greater Indianapolis, our Westfield office handles estate planning and related family law needs. If you are in Monroe County or surrounding counties, our Bloomington office can help. Together we help families put a plan in place that reflects values and protects futures.

If you want a quick review before 2026, we will listen, look at your current documents and titles, explain how the new exemption numbers affect your plan, and map simple steps. If changes are not needed, we will say so. If you need to update a will, a trust, powers of attorney, or beneficiary forms, we will make the process clear and steady. Visit our Indiana Estate Planning Attorney page or call either office to schedule a consultation and move forward with confidence.