What is an Inter Vivos Trust? A Comprehensive Legal Overview

Definition & Meaning

An inter vivos trust is a type of trust established while the creator, known as the grantor, is still alive. This trust allows the grantor to manage and hold property for the benefit of another person, often referred to as the beneficiary. Unlike a will, which takes effect after a person's death, an inter vivos trust is active during the grantor's lifetime. It is typically revocable, meaning the grantor can change or dissolve the trust at any time while they are alive.

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Legal Use & context

Inter vivos trusts are commonly used in estate planning and asset management. They can help avoid probate, provide for beneficiaries during the grantor's life, and ensure a smooth transition of assets upon the grantor's death. Legal areas that often involve inter vivos trusts include:

Estate planning
Tax law
Family law

Individuals can create these trusts using templates available through US Legal Forms, which are drafted by qualified attorneys to ensure compliance with state laws.

Key legal elements

Real-world examples

Here are a couple of examples of abatement:

Example 1: A couple establishes an inter vivos trust to manage their family home and investments for the benefit of their children while they are alive. This allows them to control how the assets are used and distributed.

Example 2: A parent sets up an inter vivos trust to provide for their child with special needs, ensuring that the child has access to funds without jeopardizing government benefits. (hypothetical example)

State-by-state differences

Examples of state differences (not exhaustive):

State	Key Differences
California	Allows for specific tax benefits under certain conditions.
New York	Has specific regulations regarding the management of trust assets.
Texas	Offers simplified procedures for revoking or modifying trusts.

This is not a complete list. State laws vary, and users should consult local rules for specific guidance.

Comparison with related terms

Term	Definition	Key Differences
Testamentary trust	A trust created through a will that takes effect after death.	Inter vivos trusts are active during the grantor's life, while testamentary trusts are not.
Revocable trust	A trust that can be altered or revoked by the grantor.	All inter vivos trusts are revocable, but not all revocable trusts are inter vivos (some may be testamentary).

Common misunderstandings

What to do if this term applies to you

If you are considering setting up an inter vivos trust, here are some steps to follow:

Evaluate your assets and decide which ones you want to include in the trust.
Determine your beneficiaries and how you want to manage the assets for their benefit.
Consult with a legal professional to ensure the trust complies with state laws.
Explore US Legal Forms for ready-to-use templates that can help you create an inter vivos trust.

If your situation is complex, seeking professional legal advice is recommended.

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Quick facts

Attribute	Details
Typical fees	Varies by attorney; generally ranges from $500 to $3,000.
Jurisdiction	State-specific laws apply.
Possible penalties	Improperly funded trusts may not be recognized in probate.