southern
indiana
Nearly every Indiana estate plan starts with the same question: is a living trust or a will the better foundation? The difference between a living trust and a will affects whether an estate goes through probate, how quickly loved ones receive assets, who can step in during a period of incapacity, and how private the family’s affairs remain. Choosing the wrong tool, or signing the right one but never funding it, can undo years of careful saving.
At Mattox & Wilson, L.L.P., our New Albany estate planning attorneys help families throughout Floyd County, Clark County, Harrison County, and the rest of Southern Indiana understand how each document works under Indiana law. Attorney Stephen T. Naville concentrates his practice on estate planning, trust preparation and administration, probate administration, elder law, and Medicaid planning.
Individuals deciding between a living trust and a will are encouraged to call our office at 812.944.8005 to schedule a consultation.
Both documents direct where property goes after death, but they operate on completely different timelines. A will is a set of written instructions that has no legal effect until the person who made it dies, and it must then pass through the probate court before assets can be distributed. A living trust takes effect the moment it is signed and funded, holds legal title to assets during life, and continues operating at death without court involvement.
That timing difference drives everything families care about, including probate exposure, privacy, incapacity planning, cost, and speed of distribution. Neither document is automatically better. The right answer depends on the size and complexity of the estate and on what the family wants to happen if illness strikes before death does.
A last will and testament names the people or organizations who inherit property, appoints a personal representative to settle the estate, and, for parents of minor children, nominates a guardian. Indiana imposes strict formalities. Under Indiana Code section 29-1-5-3, a will must be signed by the testator and by at least two witnesses, and the witnesses must sign in the presence of the testator and of each other.
A will only controls probate assets, meaning property titled solely in the decedent’s name with no beneficiary designation. Anyone who dies without a valid will is considered intestate, and Indiana’s intestate succession statutes, not the family’s wishes, then determine who inherits. Even a simple, properly executed will prevents that outcome.
A living trust, formally a revocable living trust, is a legal entity created during life to hold and manage property. The person creating the trust, called the settlor, typically serves as the initial trustee and keeps complete control, with a successor trustee named to take over at incapacity or death. Under Indiana law, a trust created under an instrument executed after June 30, 2005 remains revocable unless the trust document expressly states that it is irrevocable, so a standard living trust can be amended or revoked at any time.
A living trust only works if it is funded. Bank accounts, brokerage accounts, and real estate must actually be retitled into the name of the trust. An unfunded trust is one of the most common estate planning failures our New Albany trust lawyers encounter, because assets left outside the trust still pass through probate.
No, and the similar names cause real confusion. A living trust is a financial document that manages property. A living will is a health care document that states preferences about life-prolonging treatment when a person is terminally ill and cannot speak for themselves. One has nothing to do with the other.
Indiana modernized this area of law recently. For documents signed after December 31, 2022, health care wishes in Indiana are expressed through an advance directive under Indiana Code chapter 16-36-7, a single document that can appoint a health care representative and state end-of-life preferences, replacing the separate living will declaration used under prior law. Living wills validly signed before that date remain enforceable. Our end of life planning services help families put the current documents in place alongside a trust or will.
Yes. A will guarantees probate for the assets it controls; a funded living trust typically avoids it. Probate in Indiana takes months at minimum, involves court filings and costs, and makes the will and the inventory of assets part of the public record. Trust administration happens privately, and the successor trustee can often begin distributing assets within weeks. Families facing the court process after a death can learn more on our probate administration page.
Probate avoidance matters less for modest estates. Under Indiana Code section 29-1-8-1, estates valued at $100,000 or less may be settled with a small estate affidavit rather than formal probate for individuals who die after June 30, 2022. For families whose probate assets fall under that threshold, a will paired with beneficiary designations may accomplish nearly everything a trust would, at lower cost.
A will performs three jobs no trust can. First, only a will allows parents to nominate a guardian for minor children, which by itself makes a will essential for young families. Second, a will appoints the personal representative who handles final taxes, debts, and any court matters. Third, a will acts as a safety net, catching assets that were never titled into a trust or that arrive after death, such as a legal settlement.
A living trust manages property during life, not just after death. If the settlor develops dementia or suffers a serious accident, the successor trustee steps in immediately and pays bills, manages investments, and maintains real estate without a court-appointed guardianship. A will offers no help at all during incapacity because it has no effect until death.
A trust also keeps the estate private, speeds distribution to beneficiaries, can hold out-of-state real estate to avoid a second probate proceeding in another state, and can hold assets in continuing trust for young, disabled, or financially inexperienced beneficiaries rather than handing over a lump sum.
Most trust-based plans include both. The trust does the heavy lifting, and a short pour-over will works alongside it, nominating guardians and directing any stray assets into the trust at death. A complete plan also includes a financial power of attorney and an advance directive so that every scenario, incapacity as well as death, is covered.
Taxes rarely decide this question in Indiana. The state repealed its inheritance tax for deaths occurring after December 31, 2012 and imposes no estate tax, according to the Indiana Department of Revenue, and neither a basic will nor a revocable living trust reduces federal estate tax exposure. With the federal exemption at $15 million per person beginning January 1, 2026, the choice for most Hoosier families comes down to probate, privacy, and incapacity planning rather than tax savings.
Our firm drafts wills, prepares and funds living trusts, and administers both when the time comes. Attorney Stephen T. Naville brings nearly two decades of experience in estate planning, trust administration, probate, elder law, and Medicaid planning, and he focuses on matching the plan to the family rather than selling one document over another. Sometimes the honest answer is that a simple will is enough; sometimes a trust will save a family months of court proceedings.
Because Indiana law imposes precise execution requirements on wills and treats an unfunded trust as little better than no trust at all, the details of drafting, signing, and funding carry lasting consequences for the people left behind.
Individuals and families weighing a living trust against a will are encouraged to call Mattox & Wilson at 812.944.8005 to schedule a consultation at our New Albany office. We listen first, explain the options in plain English, and build a plan designed to protect what matters most.