Settling Small Estates (KY)

Updated Apr 5, 2024
Show Table of Contents Courthouse for estate probate

In Kentucky, estates can avoid full probate by settling the estate without administration, dispensing with administration by agreement, or via informal settlement. Regardless of estate size, probate is not required if an estate contains only assets exempt from probate.

Small Estate without Administration

If a Kentucky estate is worth <$30,000 and there is a surviving spouse, you can use the small estate process to settle an estate with minimal court involvement.


To use the small estate process, there must be a surviving spouse and the gross probatable estate must be worth <$30,000 (with some exceptions when preferred debts exist).

In determining gross probatable value of an estate, you should value assets as of the date of death. Do not include any assets that would not normally go through probate, such as assets owned in joint tenancy, assets payable on death with named beneficiaries (e.g., 401Ks, life insurance policies), and other standard probate exclusions.

If there are preferred debts (such as funeral expenses) that the surviving spouse has already paid from his or her own estate, then the $30,000 limit can be increased by the amounts of those paid debts. See Distribution Considerations below for a list of preferred debt types.


To use the small estate process:

  1. Submit to the probate court a Petition to Dispense with Administration (Form AOC 830)
  2. You will receive a court order, which you can use to obtain custody of the estate assets
  3. There is no legal requirement to do anything else, since the assets transferred are exempt from any creditor claims

See KRS § 395.455 and KRS § 395.030.

Dispensing with Administration by Agreement

You can also skip probate if the estate is simple, there is no will, and everyone agrees in writing so bypass administration.


To dispense with administration by agreement, the following conditions must be true:

  • There is no will
  • There are no (remaining) known estate debts
  • All heirs agree in writing that there should be no administration

While the statute says that the estate may have no debts, there may be circumstances in which it is worth it for the heirs to separately satisfy those debts in order to qualify for this process.

There is no official limit to the size of an estate that may be handled this way.


To use this approach process:

  1. Submit to the probate court a Petition to Dispense with Administration by Agreement (see below)
  2. Publish in a newspaper (in local circulation) a notice to creditors to present any claims to the clerk designated by the court.
  3. Obtain a bond for the value of the personal estate (this bond may be used by the court to pay any currently unknown debts that are legitimately claimed within 6 months of the requested court order
  4. After the 6-week notice period has expired, you will receive a court order transferring ownership estate assets
  5. Use the order to collect estate assets and distribute them to the rightful heirs
  6. After 6 months, you can collect the funds from the bond which were not used to pay previously unknown debts


This process is not commonly used, and thus there is no official form for the petition.

In your petition, you must include:

  • The name, residence, and date of death of the decedent
  • A statement that there is no known will
  • An inventory of estate assets
  • A statement that there are no estate debts
  • A list of all heirs entitled to inherit, including their names, addresses, and percent of estate due
  • If there are claims due to the estate, name someone who will be granted the power to collect such claims
  • Include plans for paying any state inheritance and federal estate taxes, if appropriate

Attach a copy of the death certificate, and have each heir sign the petition. Every signature must be notarized at the time of signing.

See KRS § 395.470.

Informal Settlement

If for some reason you must, or you just want to, go through official probate, you may be able to request an informal settlement in order to simplify the process.


You can use an informal settlement if:

  • The personal representative is the sole beneficiary of the estate,
  • Or all inheritors agree to an informal settlement

The estate must be solvent (able to pay all its debts).


To proceed with informal settlement:

  1. Submit to the court a Petition for Probate (Form AOC-805)
  2. Obtain any required Fiduciary Bond (Form AOC-825)
  3. The court will appoint you personal representative and give a Certificate of Qualification
  4. Use your Certificate of Qualification to collect estate assets
  5. Wait at least 6 months after you were appointed personal representative
  6. Settle the estate in the normal way (pay all obligations, distribute net assets)
  7. Submit to the court a Motion for Informal Settlement (Form AOC-850), along with a Waiver of Formal Settlement (Form AOC-851)) signed by all the heirs (if a spouse is not the sole heir)

See KRS § 395.605.

Estate Settlement Considerations

Before paying any debts or making any distributions, be sure to account for any KY Family Entitlements, which typically have priority over everything except expenses of the last illness, funeral charges, and any estate administrations expenses.

Even if the estate does not go through probate, you are still entitled to Executor Compensation in KY, and this compensation also has priority over most estate debts.

Estate debts have priority over most distributions in turn, so you should arrange to have all debts resolved before distributing assets. Unpaid estate creditors have the right to sue heirs for the value of any distributions received using the approaches described on this page, although statute of limitations in KY may bar creditors from pursuing such payment.

If estate solvency is uncertain, an executor should consider going through official probate for the increased creditor protection it offers. Alternately, such uncertainty can sometimes persuade creditors to forgive a portion of debts, since they will want to avoid legal expenses as well, and may prefer to get something rather than nothing.

If there are not enough estate funds to pay all creditors, unsecured claims must be satisfied in the following priority order:

  1. Estate administration expenses
  2. Funeral expenses
  3. Debts and taxes with preference under federal or state law
  4. All other debts

Items 1-3 are considered "preferred" debts: see KRS § 396.095.

See also Making Distributions.

No Small Estate Affidavit

Since people commonly ask, note that Kentucky has no notion of a small estate affidavit that involves no court interaction: you must use one of the above methods to settle the estate, or formal probate.


In Kentucky, the local District Court handles wills and estate probate. To find your court, select Category "District Judges", and then the county of the decedent's legal residence.

Additional Information

If your estate doesn't qualify for a small estate approach, or you're simply interested in exploring standard probate, take a look at Probate in KY.

And since probate is just the court-supervised subset of winding up a person's affairs after death, you'll probably want to check out our Complete Guide to Estate Settlement in KY.

Finally, in case you're interested, details about handling small estates in other states can be found here:

Copyright © 2014-24 EstateExec