What is inter vivos trust?

An inter vivos trust, also known as a living trust, is a type of trust that is created during the lifetime of the person who establishes it. The person who creates the trust is called the settlor or grantor, and they may also be the initial trustee and the primary beneficiary of the trust. However, the trust may also appoint a successor trustee and provide for the distribution of assets to other beneficiaries upon the settlor's death.

One of the primary benefits of an inter vivos trust is that it can be used to avoid probate. This means that when the settlor dies, their assets held in the trust can be distributed to the beneficiaries without having to go through the time-consuming and often costly process of probate court. Additionally, inter vivos trusts can be structured in a way to reduce estate taxes and protect assets from creditors.

There are two main types of inter vivos trusts: revocable and irrevocable. Revocable trusts can be changed or terminated by the settlor during their lifetime, while irrevocable trusts cannot be changed or terminated without the consent of the beneficiaries or a court order.

Overall, inter vivos trusts can be a powerful estate planning tool for individuals seeking to protect and manage their assets during their lifetime and after death.