Taxes and Your Estate

People are often very concerned about taxes on their estate. For most in Kentucky, the only taxes your heirs will face are those from a qualified IRA or 401(k), as those funds have never been taxed.

There is a common misconception that a trust will avoid taxes. Most revocable living trusts (the trust you retain control over) do not avoid taxes. The good news is that usually, people don’t even need to worry about taxes on their estate.

Federal Estate Tax

While Kentucky does not impose an estate tax, the federal estate tax still applies to very large estates (over $19 million in 2025).

Inheritance Tax

Also, Kentucky is one of the few states that does impose an inheritance tax. This tax is based on the relationship of your beneficiary. The further away the familial relationship, the more the state will tax. Click here to see if your beneficiaries will be subject to the Kentucky inheritance tax debt.

Remember, a revocable trust will not affect taxes. If you would owe them with a will, you will owe them with a trust.

The English Law Group, P.S.C., can help you understand what fits your goals and whether tax planning should be part of your trust design.