Inter vivos trust

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An inter vivos trust (sometimes also called a living trust) is an express trust created by the settlor during his or her lifetime, as distinguished from a testamentary trust which arises upon the testator's death, usually under his will.

In strict legal terms, the relevant considerations of trust law apply equally to either type of trust, however, in practical terms there is invariably some distinctions between both the reasons for the trust, and the ongoing administration of them.

For an inter vivos trust, the settlor will often retain some level of relevance to the trust, often appointing himself as the protector under the trust instrument (in jurisdictions where protectors are recognised).

Inter vivos trusts also, in practical terms, tend to be driven to a much greater extent by tax considerations.

If an inter vivos trust fails, the property will usually be held for the settlor on resulting trusts, which in some notable cases, has had catastrophic tax consequences.

A living trust is not under the control and supervision of the probate court, and property held by such a trust is not part of a decendent's probated estate.

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