Estate planning is how you plan for your medical wishes, end of life and what you want to happen after you pass. However, while Kentucky estate planning laws are similar to those of other states, there are some unique quirks that you should be aware of.
Kentucky does not have an estate tax or an inheritance tax. However, some of your beneficiaries may have to pay a federal estate tax if your estate exceeds a certain threshold ($11.7 million for 2021).
Kentucky allows you to create a living trust or a last will and testament to distribute your assets after your death. A living trust is a legal entity that holds your assets and allows you to avoid probate, which is the court-supervised process of settling your estate. A last will and testament are a document that expresses your wishes for your property and names an executor to carry out your instructions. If you die without a will or trust, your estate will be distributed according to our state’s intestate succession laws.
Types of wills
Kentucky recognizes several types of wills, including:
- Holographic will: A holographic will is written entirely in your own handwriting and signed by you.
- Oral will: An oral will is one that is spoken by you in front of two witnesses who can testify to its validity.
- Self-proving will: A self-proving will is one that is signed by you and two witnesses in front of a notary public who certifies its authenticity.
Its important to note here that a self-proving will can speed up the probate process by eliminating the need to prove signatures on the will.
Kentucky also allows you to create a living will or a health care surrogate designation to express your wishes for end-of-life medical treatment and appoint someone to make health care decisions for you if you become incapacitated.
Kentucky also allows you to create a durable power of attorney or a springing power of attorney to authorize someone to handle your financial and legal affairs if you become incapacitated.
Estate planning in Kentucky
Estate planning can be complex and challenging, especially if you have a large or blended family, own a business or have special needs beneficiaries. But, creating a comprehensive plan that suits your goals and circumstances ensures your wishes are accomplished.