Connecticut Estate Planning — What Retirees Need to Know in 2026
Connecticut levies a state estate tax on estates above $15,000,000, which catches many middle-class retirees off guard. Probate costs 3–8% of your gross estate and takes 6–12 months on average — costs that can be avoided with the right documents in place. Connecticut recognizes TOD deeds, giving residents cost-effective ways to transfer real property outside of probate. Medicaid estate recovery in Connecticut is expanded — the state can recover from assets that passed outside of probate, including TOD deeds and some trust accounts. Advanced planning is essential.
Key Connecticut Estate Planning Facts for 2026
| Topic | Connecticut Rule | Risk Level |
|---|---|---|
| State Estate Tax | Yes | Review |
| State Inheritance Tax | None | Low |
| Probate Cost Estimate | 3–8% · 6–12 months | Moderate |
| Medicaid Look-Back Period | 60 months (5 years) for asset transfers | High |
| Homestead Exemption | $75,000 | Protective |
| Lady Bird Deeds | No | Not Available |
| TOD Deeds | Yes (TOD Deed) | Protective |
| Asset Protection Trust | No | Gap |
| Power of Attorney | notarization required; 2 witness(es) required | Required |
Connecticut Probate: What It Costs and How to Avoid It
Connecticut uses its own probate code, which can make the process more structured and court-supervised than UPC states. Even so, probate still costs 3–8% of gross estate value and takes 6–12 months on average. Estates under $40,000 may qualify for a simplified affidavit process.
- Revocable Living Trust Assets properly funded into a trust pass outside probate and remain private. Typical cost range: $3500–$6000.
- TOD Deed Expanded recovery state; TOD deed does not protect home from Medicaid estate recovery. Trust or Lady Bird Deed (where available) may offer better protection.
- Joint Ownership Planning Joint tenancy structures can avoid probate but may create tax or creditor exposure. Review before implementing.
- Small Estate Affidavit Available for estates under $40,000. Waiting period: 30 days.
*Estimates derived from Connecticut probate and Medicaid data. Educational use only.
Medicaid Asset Protection: Connecticut's 60-Month Rule Explained
Connecticut follows federal Medicaid rules with a strict 60-month look-back period. Any asset transfer for less than fair market value within that window can trigger a penalty period. Warning: Connecticut uses expanded estate recovery, meaning Medicaid can recoup from assets that passed outside of probate.
- Medicaid Trust Planning Assets placed in a properly structured irrevocable trust may be protected after the 60-month look-back expires.
- Spousal Asset Protection Community spouse resource allowance for 2026: $162,660.
Connecticut Estate Planning Checklist — What to Do Next
| Priority | Action | Cost Range | Impact |
|---|---|---|---|
| High | Update all beneficiary designations | $0 | Avoids unintended probate transfer |
| High | Execute Durable Power of Attorney | $400–$800 | Protects during incapacity |
| Medium | Create Revocable Living Trust | $3500–$6000 | Full probate avoidance |
| Medium | Elder Law Consultation | $400–$600 | Reduce Medicaid exposure |