RIVT – Revocable Inter Vivos Trust

1.    Advantages -

a.    Avoid probate,
b.    Avoid FET for T if trust qualifies for the UMD,
c.    Avoid FET for surviving spouse when dies if a proper bypass trust,
d.    Manage assets for inept spouse or for children – if life interest only, no FET when spouse or kids die because interest terminated at their death,
e.    Alzheimer’s trust – manage assets for old person.

2.    Gift tax consequences of trust for children – qualifying trust is eligible for annual $10,000 exclusion, even though it is a future interest and not the usually required present interest.

a.    Requirements (UGMA)

(1)  Gift in trust for benefit of a minor
(2)  Possession is postponed until minor is 21

b.    Results – eligible for $10,000 annual exclusion