How does "inter vivos" gifting differ from testamentary gifting?

"Inter vivos" gifting refers to gifts made during a person's lifetime, distinguishing them from testamentary gifts, which take effect only upon an individual's death. In the context of estate law, inter vivos gifts are typically seen as transfers of assets that occur while the donor is alive, meaning the donor actively conveys ownership to the recipient before they pass away.

This form of gifting has significant implications in estate planning and can affect the overall distribution of property upon a person's death. Inter vivos gifts are irrevocable once made, meaning the donor cannot change their mind after the transfer has occurred. They often allow individuals to see their beneficiaries enjoy the benefits of the gift.

In contrast, testamentary gifts are outlined in a will and are not effective until after the testator (the person who made the will) has died. This difference places inter vivos gifting in a category where the donor retains more control and involvement in the gifting process compared to the nature of testamentary gifts which are entirely reliant on the conditions of the will.

Understanding this distinction is critical in the context of estate planning, as inter vivos gifts can impact a person's estate and the way assets are distributed to heirs at death.