KRS 140.015 — Exemption of benefits from federal government arising out of military service

(1) The payment of any gratuity pay, death compensation or other award or benefit, by
the federal government, to the surviving spouse or heirs of any person by reason or
arising out of service by such person in the Armed Forces of the United States in
time of war shall not be considered a taxable transfer within the meaning of this
chapter, and the amount paid shall not be considered in determining the value of any
taxable transfer.
(2) Payments made to a beneficiary of the retired serviceman's family protection plan or
survivor benefit plan shall not be considered a taxable transfer within the meaning
of this chapter, and the amount paid shall not be considered in determinin g the
value of any taxable transfer.