A living trust—also known as an inter vivos trust—is a trust that is created and takes effect during the lifetime of the person who creates the trust and places assets in it (the grantor or settlor). The beneficiaries named in the living trust will receive the assets or the income from the assets, as provided by the trust agreement.
The living trust will name a trustee (and possibly successor trustees) to manage and administer the trust.
A living trust is in contrast with a testamentary trust that is created by a will and takes effect when the grantor or settlor (the testator who made the will) dies.
In Texas, a living trust, or inter vivos trust, is a legal arrangement where a grantor places assets into a trust to be managed by a trustee for the benefit of designated beneficiaries during the grantor's lifetime. The trust is governed by the terms set out in the trust agreement. Living trusts in Texas are commonly used to manage assets, avoid probate, and maintain privacy, as the trust's details are not made public like a will. The trust document names a trustee who is responsible for managing the trust's assets according to the grantor's instructions. Successor trustees may also be named to take over if the original trustee is unable to serve. Unlike a testamentary trust, which is established upon the death of the individual and is part of a will, a living trust is effective immediately upon creation and funding with the grantor's assets. Texas law, including the Texas Trust Code, provides the regulatory framework for the creation and administration of living trusts, and it requires that the trust be created for a lawful purpose, with a definite beneficiary, and that the trustee has duties to perform.
