Inter Vivos Trust
What Is an Inter Vivos Trust?
An inter vivos trust is a trust that is created and takes effect during the lifetime of the person who establishes it. The term comes from Latin and means “between the living.” These trusts allow assets to be placed under the management of a trustee while the grantor is still alive.
Inter vivos trusts are commonly used in estate planning to manage assets, provide for beneficiaries, and potentially avoid probate.
Why It Matters
Inter vivos trusts can help individuals manage how their assets are handled both during their lifetime and after death. By placing property into the trust, the grantor may simplify estate administration and ensure assets are distributed according to specific instructions.
These trusts may also provide privacy, as trust administration generally occurs outside the public probate process.
How an Inter Vivos Trust Works
An inter vivos trust is created when a grantor establishes a trust agreement and transfers assets into the trust during their lifetime.
Key elements typically include:
- the grantor who creates the trust
- the trustee who manages the trust
- the beneficiaries who receive benefits
Assets transferred to the trust are managed according to the terms outlined in the trust document.
Example
A person creates a trust during their lifetime and transfers ownership of their home and investment accounts into it. The trustee manages the assets according to the trust agreement.
Inter Vivos Trust vs Testamentary Trust
- An inter vivos trust is created during the grantor’s lifetime.
- A testamentary trust is created through a will and becomes effective after death.
FAQs About Inter Vivos Trusts
Can an inter vivos trust be revocable?
Yes. Many inter vivos trusts are revocable living trusts.
Do assets in an inter vivos trust avoid probate?
Assets held in the trust generally bypass the probate process.
Who controls an inter vivos trust?
Control depends on the trust terms and the trustee responsible for managing the assets.
Related Terms
