We love to have choice. The ability to choose is an integral part of our society and how we live our lives. Although you might not be thinking about it, you can also choose what happens to you, your family, and your property after you die.
Jump ahead to these sections:
- Indiana's Intestacy Laws Explained
- How Does Probate Work in Indiana If There Is No Will?
- Who Typically Inherits Assets in Indiana If There Isn't a Will?
- Frequently Asked Questions: Dying Without a Will in Indiana
Estate planning in Indiana lets Hoosiers exercise choice after death. This involves writing a will. A valid will in Indiana lets you choose who will receive and manage your money and property when you're gone. Unfortunately, many people in Indiana fail to take advantage of this. This article discusses what happens if you die without a will in Indiana.
Indiana's Intestacy Laws Explained
If you execute a valid will in Indiana before you die, you can decide who the new owners of all your stuff and money will be after death. Having a will means you will avoid static and "frozen" assets, which is what happens if you die without a will. Freezing your assets could be a significant problem because your assets will not have a clear owner.
To avoid this, states have laws determining who owns the assets of a deceased person who died without a will. These rules are the intestacy laws. The intestacy laws determine who will get all of your assets if you die without a will.
Indiana has its own set of intestacy laws. Under Indiana's laws, if you die without a will, your assets go to the following people:
- If you have a surviving spouse and no surviving children, grandchild, or parents, everything goes to your surviving spouse.
- If you have a surviving spouse and children or grandchildren (also called "descendants"), 50% of your assets go to your surviving spouse, and the other 50% will be split among your descendants.
- If you have both a surviving spouse and parents but no surviving descendants, 75% of your assets go to the surviving spouse and 25% to your surviving parents.
- If you do not have a surviving spouse but have surviving descendants, your descendants get everything.
- If you have no surviving spouse and no descendants, but you do have surviving parents, one of two things can happen:
- 1) If you have no surviving siblings and no nieces or nephews, everything will go to your parents.
- 2) If you have surviving siblings and surviving parents but no surviving nieces or nephews, your assets will be divided equally among your parents and siblings, provided that each parent receives no less than a 25% of the total worth.
- If you have no surviving spouse, no descendants, no parents, no nieces or nephews, but you do have surviving siblings, the state will split your assets equally among your siblings.
If you have a lot of descendants, and they are all of the same closeness in relation, e.g., they are all your children, or they are all your grandchildren, they will all receive equal shares. For anyone who is more distantly related, their shares are determined slightly differently, depending on how they are "represented" in your life. The representation rules are as follows:
- Example 1 - Judy died and left behind her two children, Melanie and David. As Melanie and David are of the same degree of kinship to Judy (they are both equally her children), they both get an equal 50% share of Judy's assets.
- Example 2 - Suppose David dies before his mother Judy, and he is survived by his two children, Natalie and Valerie. Natalie and Valerie are Judy's grandchildren, and Melanie is her child. Melanie is entitled to 50% of the assets, and Natalie and Valerie will get 25%. Natalie and Valerie receive their shares by "representation" from their deceased father, David.
There are other similar laws in Indiana based on different family situations.
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How Does Probate Work in Indiana If There Is No Will?
The laws in Indiana determine who your beneficiaries are if you die without a will. Relatedly, Indiana's probate laws control how those assets transfer to your heirs.
Probate is a legal process that manages a deceased person's estate. A judge in a probate court supervises, and it usually happens in the county where the deceased person resided.
In Indiana, every case must go through probate, even if the deceased had a valid will.
Probate in Indiana begins with the probate judge appointing a person to manage the estate. If the deceased did not have a will, this person is known as the administrator or personal representative.
This personal representative has various responsibilities, including:
- Collecting and taking inventory of all the assets.
- Maintaining the upkeep of the assets (e.g., making sure any houses or cars don't fall apart and are in good condition).
- Filing any required tax returns.
- Notifying any creditors and paying any bills.
- After paying bills, they distribute the rest of the assets to the beneficiaries.
- Appearing before the probate court judge to close the estate.
Indiana has two types of probate - unsupervised administration and supervised administration.
Unsupervised administration means the judge will be less involved. It's usually a quicker and cheaper process than supervised administration.
Who Typically Inherits Assets in Indiana If There Isn't a Will?
The laws in Indiana say that close family members, like a spouse, child, sibling, or parent, will usually inherit everything if there is no will. The law assumes that most people want their close family to inherit their property. Indiana's intestacy laws are a default to fall back on if you don't have a will. Of course, not all Hoosiers may want their close family to inherit their assets.
- Bill dies, leaving behind his brother, Aaron. Bill wants to give all his assets to a charity, but he doesn't leave a will. Under Indiana's intestacy laws, Aaron inherits all of Bill's assets, despite what Bill may have wanted.
- Ed dies, survived by his wife, Trudy, and his mother, Sally. Ed wants everything to go to Trudy. But under Indiana's intestacy laws, Trudy can only 75%, and Sally is entitled to 25% of Ed's assets.
- Felicia dies, survived by her two children, Lucy and Victor. Felicia has two assets: a home worth $500,000 and stocks valued at $300,000. Felicia wants to transfer full ownership of her house to Lucy and full ownership of her stocks to Victor but does not execute a will. Under Indiana's intestacy laws, since both children are entitled to exactly 50% of everything, Lucy inherits only $400,000 (and not full ownership of the home), and Victor inherits $400,000.
In each of these examples, the deceased person did not have a valid will, so what they wanted didn't happen, and the state had to fall back on its laws to distribute the assets.
Frequently Asked Questions: Dying Without a Will in Indiana
Many questions arise when you die without a will in Indiana. Here are some of the frequently asked questions on this topic.
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What happens when your parent dies without a will?
If your parent dies without a will in Indiana, what you get is determined by the laws outlined above.
If your parent leaves a spouse from a first marriage behind, they will get 50% of the assets, and you and any other descendants will split the other 50% of your parent's assets between you. If the surviving spouse is from a second or later marriage and did not have children with your parent, you get 75% of your parent's property.
If your parent does not have a surviving, you and any other descendants will equally split all of your parent's assets. So if you are an only child, you will get everything. If you have four siblings, you get 20% (⅕) of your parent's assets.
What are a surviving spouse's rights if there's no will?
If a married person dies without a valid will in Indiana, the laws outlined above define what the surviving spouse inherits.
If there are no surviving descendants or parents, the surviving spouse receives all of the deceased person's assets.
If there are surviving descendants, the surviving spouse receives 50% of the deceased spouse's assets (unless they are from a second or later marriage, as outlined above)
If you have surviving parents but no surviving descendants, your surviving spouse receives 75% of the deceased person's assets. Your parents receive the other 25%.
How do you become an executor of an estate without a will in Indiana?
Sometimes, your surviving spouse might also become the manager or executor of your estate.
If the deceased has a will, that will should name an "executor" who will manage the estate. If there is no will, a probate court judge will appoint an administrator or personal representative to manage an estate in Indiana.
Indiana law has a hierarchy of who can be appointed personal representative if there is no will. The first choice is a surviving spouse. If there is none, then a judge can name another beneficiary.
Who is considered next of kin in Indiana?
Under Indiana's law, there is no legal definition of "next of kin."
However, the law does define different "degrees of kinship," meaning how closely someone is related to the deceased person.
Usually, most people consider their closest relatives like spouses, children, parents, or siblings their "next of kin."
Estate Planning - You Can and Should "Have It Your Way"
It is not difficult to have a valid will in Indiana. You need a written document that you sign and date, witnessed by two independent witnesses. That is all you need to implement your testamentary intentions – a.k.a what your want to happen to your property after your death.
You control what happens to your assets after you die with a valid will.