A trust is a legal arrangement in which a trustee holds and manages assets for beneficiaries under terms you set. In New York, the core benefit is probate avoidance — assets titled in a properly funded trust pass to your beneficiaries without going through your borough’s Surrogate’s Court, preserving privacy, speed, and control. Trusts also enable asset protection and Medicaid planning under the EPTL.
Grantor (definition): The person who creates a trust and transfers assets into it (also called settlor or trustor). Trustee (definition): The person or institution that holds and manages trust assets for the beneficiaries. Beneficiary (definition): A person entitled to benefit from the trust. Corpus (definition): The body of assets held in the trust (the principal).
Should I use a revocable living trust or just a will?
A revocable living trust is one you create and control during your lifetime and can change or cancel at any time. The decisive NYC advantage is keeping your co-op or condo out of Surrogate’s Court.
| Feature | Will | Revocable Living Trust |
|---|---|---|
| Avoids probate | No | Yes (if funded) |
| Private (not public record) | No — filed with court | Yes |
| Effective during incapacity | No | Yes |
| Upfront cost | Lower | Higher |
| Control during life | Full | Full |
| Estate-tax savings by itself | No | No |
A revocable trust does not save estate tax on its own and does not protect assets from creditors or Medicaid — those goals need different tools, below.
How do irrevocable and Medicaid trusts work in New York?
An irrevocable trust cannot be freely changed or revoked after creation. Because you give up control, assets can be shielded from estate tax and, with a Medicaid Asset Protection Trust (MAPT), from long-term-care spend-down.
New York’s Medicaid program applies a five-year lookback for institutional (nursing home) care: transfers into a MAPT must generally be made at least 60 months before applying. A NYC co-op or condo placed in a MAPT today can be protected from a future nursing-home spend-down if the lookback has run. Timing is everything — there is no retroactive fix.
Trust types used in New York
| Trust type | Primary use | Note |
|---|---|---|
| Revocable living trust | Probate avoidance, incapacity | Fully changeable; no tax/asset protection |
| Irrevocable trust | Estate tax, asset protection | Gives up control |
| Medicaid Asset Protection Trust | Long-term care planning | 5-year lookback |
| Supplemental/Special Needs Trust | Disabled beneficiary | EPTL 7-1.12 preserves benefits |
| Testamentary trust | Created by your will at death | Goes through probate first |
Supplemental Needs Trust: Under EPTL 7-1.12, an SNT lets a disabled beneficiary receive support without losing means-tested benefits like Medicaid and SSI.
Why do unfunded trusts fail?
Creating a trust document does nothing until you fund it — actually re-titling assets into the trust’s name. An unfunded revocable trust is a common, expensive mistake: if your co-op shares still read in your individual name at death, the apartment goes through probate anyway. Funding a co-op requires the co-op corporation’s consent to reissue the stock certificate and proprietary lease in the trustee’s name, and most boards have a process for this. Condos and bank/brokerage accounts are re-titled by deed and account paperwork. We treat funding as part of the job, not an afterthought.
What duties does a New York trustee have?
A trustee is a fiduciary. Under the Prudent Investor Act, EPTL 11-2.3, the trustee must invest and manage trust assets prudently, diversify, act impartially among beneficiaries, and keep clear records and accountings. A trustee who self-deals or invests recklessly can be held personally liable.
The NYC probate-avoidance payoff
In New York City, a revocable trust solves a specific problem: a co-op apartment is not real property — you own shares plus a proprietary lease — and there is no transfer-on-death deed for any NYC property. So title to your apartment cannot simply name a death beneficiary. Without a trust or joint ownership, those shares pass through Surrogate’s Court, where the co-op board’s transfer review and the court’s timeline stack on top of each other. A funded revocable trust collapses that into a private, out-of-court transfer to your named beneficiaries. For a Tribeca condo or an Upper West Side co-op, that can mean months saved and your estate kept off the public record. See how probate otherwise unfolds in our NYC probate process guide.
Frequently asked questions
Do I need a trust if I already have a will in New York? Often yes — a will still requires probate. A funded revocable trust avoids Surrogate’s Court for the assets it holds, which is valuable when a co-op or condo is involved.
Can I put my NYC co-op shares in a trust? Yes, but the co-op corporation must approve re-issuing the shares and proprietary lease to your trust. EPTL 7-1.12 and standard trust law permit trusts to hold co-op shares.
Does a revocable trust protect my home from Medicaid? No. Only an irrevocable Medicaid Asset Protection Trust, funded at least five years before applying for institutional Medicaid, offers that protection.
Will a trust lower my New York estate tax? A revocable trust will not. Certain irrevocable trusts (such as credit-shelter or insurance trusts) can — see our estate taxes guide.
Find out which trust fits your NYC estate
Russel Morgan can tell you whether a revocable trust, a MAPT, or no trust at all makes sense for your assets. Schedule a 30-minute consultation.