At a glance
| State estate tax | No |
|---|---|
| Estate top rate | — |
| Inheritance tax | Yes — up to 16%KRS 140.070 (rates & classes, as amended by 2026 Ky. Acts ch. 198 § 40, eff. 2026-04-27, applying to deaths on/after 2026-01-01); KRS 140.080 (exemptions) · 2026 deaths |
| Small-estate ceiling | $30,000KRS 391.030 / 395.455 · current |
| TOD deed for real estate | Not availableKy. — no TOD deed statute (SB 34, 2026, pending) · not enacted as of 2026 |
| Community-property state | No |
Estate tax
Kentucky does not levy its own estate tax. An estate here is subject only to the federal estate tax, which most estates never owe — the federal exclusion is measured in the millions. See the federal lifetime exemption for how that works.
Inheritance tax
Class A (surviving spouse, parent, child, grandchild, sibling, half-sibling) is fully exempt for deaths after June 30, 1998 (KRS 140.080).
Class B (niece, nephew, daughter- or son-in-law, aunt, uncle, great-grandchild) gets a $1,000 exemption, then graduated rates of 4% to 16% (KRS 140.070). Class C (all others — cousins, more distant relatives, friends) gets a $500 exemption, then 6% to 16%.
The top marginal inheritance-tax rate is 16% for both Class B and Class C. Whether an inheritance is taxed turns on the beneficiary's relationship, not the size of the estate.
Probate basics
KRS 391.030 sets apart up to $30,000 of personal property or bank funds for the surviving spouse (or, if none, the children); where estate assets fall within that exemption, KRS 395.455 lets the estate be settled without formal administration.
Kentucky is a common-law (separate-property) state for ownership between spouses. A transfer-on-death deed for real estate is Not available Ky. — no TOD deed statute (SB 34, 2026, pending) · not enacted as of 2026 — see the full Kentucky transfer-on-death deed guide for the requirements, revocation, and alternatives. The probate deadlines for this state — filing the will, the creditor-claim window, the inventory — are cited in the Executor & Heir’s Guide.
State-specific quirks
Immediate family exempt, others taxed
Class A beneficiaries (spouse, parents, children, grandchildren, siblings) pay no Kentucky inheritance tax. The burden falls on Class B relatives (nieces, nephews, aunts, uncles, in-laws) and Class C beneficiaries (cousins, distant relatives, friends), who face graduated rates topping out at 16%.
No estate tax, only an inheritance tax
Kentucky has had no estate tax since January 1, 2005. Its only death tax is the inheritance tax under KRS ch. 140, measured by each beneficiary's relationship rather than total estate size.
Kentucky does not allow TOD deeds
Unlike most states, Kentucky has not enacted a transfer-on-death (beneficiary) deed as of 2026 — a bill (SB 34) was still pending. Kentucky real estate must pass by will, survivorship, trust, or intestacy, not a TOD deed.
Where to read next
- the federal lifetime exemption — how the far larger federal exclusion works — and why a state tax can still apply below it
- funding a revocable trust — the most common way to keep property out of probate entirely
- the ILIT cluster — keeping a life-insurance death benefit out of a taxable estate
- the Executor & Heir's Guide — the probate deadlines for this state, cited to the statute
- Kentucky small-estate procedure — the state’s simplified transfer or administration route, eligibility rules, and claimant responsibilities.
- ← Back to the 51-jurisdiction comparison
Sources & methodology
Methodology & sources
Estate and inheritance tax figures reviewed by Sakineh Majd, J.D. — Maine Bar #004999 · 2026-07-24. The review memo explains its scope and source checks.
Tax figures include citations and source effective dates. Unconfirmed figures direct readers to the state. Aggregator roundups are not sources. See our editorial standards.
General information, not legal or tax advice. Residency, property location, and title can change the result. A professional licensed in Kentucky can assess your situation.
Last verified July 24, 2026.