This page provides a plain-English summary of key elder care and estate planning information specific to Kentucky residents. It covers Kentucky Medicaid limits, estate and inheritance tax rules, advance directive information, and links to important Kentucky agencies and resources.
Information on this page is updated periodically but laws and limits change frequently. Always verify current figures with the relevant agency or a licensed attorney.
Kentucky Medicaid — 2026 Eligibility Limits for Long Term Care
Kentucky’s Medicaid program is administered by the Kentucky Cabinet for Health and Family Services — CHFS — Department for Medicaid Services. Kentucky expanded Medicaid under the Affordable Care Act in 2014 providing coverage to adults up to 138 percent of the federal poverty level. Most Kentucky Medicaid members receive services through managed care organizations — MCOs — through the kynect enrollment system.
Income limit — single applicant The income limit for a single Kentucky nursing home Medicaid applicant is $2,982 per month in 2026. Kentucky is an income cap state meaning applicants whose income exceeds this limit must establish a Qualified Income Trust — also called a Miller Trust or QIT — to qualify.
Asset limit — single applicant A single applicant must have $2,000 or less in countable assets. Exempt assets include the primary residence with equity up to $752,000 if the applicant intends to return home, one vehicle, personal belongings and household furnishings, and irrevocable burial trusts.
IRA and retirement account treatment — favorable rule in Kentucky Kentucky has a favorable rule for IRAs and 401(k)s — they are exempt from the Medicaid asset limit. This is more favorable than most states which count retirement accounts as countable assets and makes Kentucky Medicaid planning more straightforward for seniors who have saved primarily through retirement accounts.
Home and Community Based care — HCB Waiver Kentucky’s primary HCBS program for seniors is the Home and Community Based — HCB — Aged and Disabled Waiver which provides home and community based services for people aged 65 and older or physically disabled adults who need nursing facility level care but want to remain in the community. The asset limit is $2,000 for a single applicant and the income limit is $2,982 per month. As of early 2026 there is a waitlist — placement is based on application date not urgency of need. Families should apply and register as early as possible. Contact the Aging and Disability Resource Center at 1-800-372-2973 or apply through kynect.
Kentucky Transitions — Money Follows the Person Kentucky reserves 150 HCB Waiver slots specifically for nursing home residents who want to transition back to community living. This program — called Kentucky Transitions — helps people return home with appropriate supports in place.
Married couples — one spouse applying When only one spouse applies for Kentucky Medicaid the community spouse — the spouse who remains at home — may retain 50 percent of the couple’s combined countable assets up to a maximum of $162,660. If 50 percent of the couple’s assets is less than $32,532 the community spouse may retain up to $32,532. The applicant spouse retains $2,000.
Monthly Maintenance Needs Allowance The minimum Monthly Maintenance Needs Allowance for the community spouse is $2,643.75 per month in 2026. The maximum is $4,066.50 per month for community spouses with high housing costs.
Personal needs allowance Kentucky nursing home Medicaid recipients are allowed to keep $60 per month as a personal needs allowance. The remainder of income is applied toward the cost of care.
Look-back period and divestment penalty Kentucky has a 60-month — five year — look-back period for nursing home Medicaid and HCB Waiver applications. Asset transfers made within 60 months of applying that were for less than fair market value may result in a penalty period of ineligibility. The 2026 divestment penalty divisor in Kentucky is approximately $8,000 per month reflecting the state’s average nursing home costs.
Estate recovery Kentucky requires Medicaid estate recovery. After a Kentucky Medicaid recipient dies the state seeks reimbursement from the estate for long term care costs paid. Planning with an elder law attorney can help protect assets from estate recovery.
How to apply for Kentucky Medicaid Applications can be submitted online through kynect at kynect.ky.gov, by phone at 1-855-459-6328, or in person at your local Department for Community Based Services — DCBS — office.
Kentucky Medicaid administering agency Kentucky Cabinet for Health and Family Services — chfs.ky.gov
Kentucky Estate and Inheritance Tax — 2026
Kentucky has no state estate tax but does have a state inheritance tax — one of only a handful of states that still does. However Kentucky’s inheritance tax has been significantly narrowed in recent years and a major 2026 change further reduced its reach.
No Kentucky state estate tax Kentucky has not imposed a state estate tax since January 1 2005. No Kentucky estate tax applies to any estate regardless of size.
Kentucky inheritance tax — major 2026 change Kentucky imposes an inheritance tax based on the beneficiary’s relationship to the deceased. Kentucky classifies beneficiaries into three classes.
Class A beneficiaries — which include the surviving spouse parents children grandchildren brothers sisters half-brothers and half-sisters — are fully exempt from Kentucky inheritance tax. No tax applies regardless of the amount inherited.
Class B beneficiaries — which include nieces nephews half-nieces half-nephews aunts uncles sons-in-law daughters-in-law and great-grandchildren — were previously subject to inheritance tax on amounts over $1,000. Effective January 1 2026 Kentucky enacted HB726 which fully exempts Class B beneficiaries from inheritance tax. Class B beneficiaries inheriting from decedents who died on or after January 1 2026 owe no Kentucky inheritance tax.
Class C beneficiaries — which includes all other persons not in Class A or Class B such as cousins friends and unrelated individuals — still owe Kentucky inheritance tax. Class C beneficiaries receive a $500 exemption and pay tax at rates ranging from 6 percent to 16 percent on a progressive scale on amounts above the exemption.
In practice the 2026 changes mean that the vast majority of Kentucky inheritances — those passing to immediate and extended family members — are now fully exempt from Kentucky inheritance tax. Only inheritances passing to unrelated persons or distant relatives not covered by Class A or Class B remain taxable.
5 percent discount for timely payment If Kentucky inheritance tax is due and is paid within nine months of the decedent’s death a 5 percent discount is allowed. If the tax liability exceeds $5,000 beneficiaries may elect to pay in 10 equal annual installments.
Federal estate tax Kentucky residents may be subject to the federal estate tax. The federal estate tax exemption is $15,000,000 per person in 2026 following enactment of the One Big Beautiful Bill Act. The exemption is portable between spouses meaning a married couple can protect up to $30,000,000 from federal estate tax with proper planning. The top federal estate tax rate is 40 percent on amounts above the exemption.
No Kentucky gift tax Kentucky does not impose a state gift tax. Federal gift tax rules apply — the annual gift tax exclusion is $19,000 per recipient in 2026.
Kentucky income tax — dropping to 3.5 percent in 2026 Kentucky has been aggressively reducing its income tax rate. The flat income tax rate drops to 3.5 percent for the 2026 tax year — down from 4 percent in 2025 and 5 percent in prior years. Social Security benefits are not taxed in Kentucky. Kentucky offers a retirement income exclusion of up to $31,110 for pension and retirement account income which means many Kentucky retirees pay little or no Kentucky income tax on retirement income.
Kentucky homestead exemption for seniors Kentucky homeowners aged 65 and older or who are totally disabled may qualify for a homestead exemption. The exemption value for 2025-2026 is $49,100 meaning the home’s assessed value is reduced by that amount before property taxes are calculated.
Kentucky Advance Directives
Kentucky law recognizes the following advance directive documents:
Kentucky Living Will Directive Documents your wishes regarding life-sustaining treatment when you have a terminal condition or are in a permanently unconscious state. Must be signed and witnessed by two adults.
Kentucky Health Care Surrogate Designation Names a healthcare surrogate to make medical decisions on your behalf when you are unable to do so. Must be signed and witnessed by two adults.
Kentucky POLST — Physician Orders for Life-Sustaining Treatment Kentucky uses a POLST form for seriously ill patients that documents specific medical orders regarding CPR hospitalization and artificial nutrition. Must be signed by a physician or nurse practitioner.
Kentucky Do Not Resuscitate Order A physician order directing emergency personnel not to perform CPR. Kentucky has standardized out-of-hospital DNR protocols.
Kentucky Advance Directive Registry Kentucky does not maintain a statewide advance directive registry. Copies of your advance directive should be given to your healthcare surrogate physician and any hospital or care facility where you receive care.
Free Kentucky advance directive forms Free Kentucky-specific advance directive forms are available at caringinfo.org and from the Kentucky Medical Association at kyma.org.
Kentucky Key Agencies and Resources
Kentucky Cabinet for Health and Family Services — CHFS Administers Kentucky Medicaid including long term care programs. Website: chfs.ky.gov kynect Portal: kynect.ky.gov Phone: 1-855-459-6328
Kentucky Department for Aging and Independent Living — DAIL Coordinates programs and services for older Kentuckians including home care nutrition programs caregiver support and the Kentucky SHIP program for free Medicare counseling. Website: chfs.ky.gov/aging Phone: 1-800-372-2973 Kentucky SHIP — free Medicare counseling: 1-877-293-7447
Kentucky Area Agencies on Aging Kentucky is served by 15 Area Agencies on Aging that coordinate local services for older adults and caregivers. Eldercare Locator: 1-800-677-1116 or eldercare.acl.gov
Kentucky Long Term Care Ombudsman Program Advocates for the rights of residents of nursing homes and assisted living facilities. Investigates complaints and helps resolve problems free of charge. Website: chfs.ky.gov/ombudsman Phone: 1-800-372-2991
Kentucky Bar Association Lawyer Referral Service Connects Kentuckians with attorneys including those who specialize in elder law and estate planning. Website: kybar.org Phone: 1-502-564-3795
Legal Aid Network of Kentucky Provides free civil legal services to low income Kentuckians including seniors on issues related to Medicaid benefits housing and elder law. Website: lanky.org Phone: 1-866-534-5243
Kentucky Veterans Resources
Kentucky Department of Veterans Affairs — KDVA Provides services and benefits to Kentucky veterans and their families including free VA claims assistance and connections to Kentucky veterans resources. Website: veterans.ky.gov Phone: 1-502-595-4447
Kentucky Veterans Centers Kentucky operates veterans centers providing long term care to eligible veterans and their spouses. Facilities are located in Hazard Hanson and Wilmore. Website: veterans.ky.gov/veterans-centers
Kentucky Senior Property Tax Benefits
Homestead Exemption Kentucky homeowners aged 65 and older or who are totally disabled may qualify for a homestead exemption of $49,100 in 2025-2026. The exemption reduces the assessed value of the home before property taxes are calculated. Apply through your county property valuation administrator’s office.
Disabled Veteran Property Tax Exemption Kentucky veterans who are totally and permanently disabled due to a service-connected disability may qualify for property tax exemption on their primary residence. Contact your county property valuation administrator for details.
Finding Elder Law and Estate Planning Attorneys in Kentucky
The following resources can help you find a qualified elder law or estate planning attorney in Kentucky:
- National Academy of Elder Law Attorneys — NAELA — naela.org — searchable directory by location
- Kentucky Bar Association Lawyer Referral Service — kybar.org — 1-502-564-3795
- Kentucky Chapter of NAELA — Kentucky has an active NAELA chapter with members throughout the state
- Legal Aid Network of Kentucky — lanky.org — free legal assistance for income-qualifying seniors — 1-866-534-5243
The information on this page is for general informational purposes only and does not constitute legal or financial advice. Kentucky Medicaid rules inheritance tax rates and other figures change frequently. Always verify current information with the relevant agency or a licensed attorney. Laws vary and individual circumstances differ significantly.
Last updated: April 2026