Do You Need a Trust in New York? Revocable, Irrevocable & Medicaid Trusts

A trust is a legal arrangement in which a grantor transfers assets to a trustee to hold and manage for named beneficiaries. In New York, the central benefit is that assets titled in a properly funded trust pass outside probate — they never enter the decedent’s county Surrogate’s Court — preserving privacy, avoiding SCPA filing delays, and, with irrevocable trusts, protecting assets for Medicaid and estate-tax planning. New York trusts are governed by the Estate Powers and Trusts Law (EPTL).

Because New York probate is administered county by county under the SCPA, a trust’s probate-avoidance value is the same wherever you live — a funded trust keeps your home or accounts out of the Surrogate’s Court in Nassau, Monroe, or New York County alike.

Revocable living trust vs. will: how they compare

Feature	Revocable living trust	Will
Avoids probate	Yes (for funded assets)	No — goes through probate
Privacy	Private; not filed publicly	Filed with Surrogate’s Court, public
Effective during incapacity	Yes — successor trustee steps in	No — needs a separate POA
Changeable while alive	Yes, fully revocable	Yes, by codicil/new will
Asset protection	None (you control it)	None
Upfront cost	Higher	Lower

A revocable living trust is about control and avoiding probate, not tax or creditor protection — you keep full power to amend or revoke it, so the IRS and Medicaid still count the assets as yours.

Definitions — Grantor: the person who creates and funds the trust. Trustee: the person or institution that manages it. Beneficiary: who benefits. Corpus: the property held in the trust (also called the trust principal or res).

Irrevocable trusts and Medicaid Asset Protection Trusts

An irrevocable trust cannot be freely changed or revoked, and the grantor gives up control — which is exactly what makes it useful. A Medicaid Asset Protection Trust (MAPT) moves assets (often the home) out of your name so they aren’t counted for long-term-care Medicaid eligibility.

The catch is New York’s 5-year lookback for institutional (nursing-home) Medicaid: transfers into the trust within 60 months of applying can trigger a penalty period. (New York is also phasing in a lookback for community-based/home-care Medicaid — verify the current implementation status before relying on it.) MAPTs work best when set up well in advance of any anticipated need.

New York trust types at a glance

Trust type	Revocable?	Primary purpose	Key NY note
Revocable living trust	Yes	Probate avoidance, incapacity	No tax/creditor protection
Irrevocable trust	No	Asset protection, estate-tax reduction	Gives up control
Medicaid Asset Protection Trust	No (irrevocable)	Shield assets from Medicaid spend-down	5-year lookback
Supplemental/Special Needs Trust	Varies	Preserve benefits for a disabled beneficiary	EPTL 7-1.12
Testamentary trust	Created by will	Control distributions after death	Created through probate

How funding a trust works — and why unfunded trusts fail

Creating a trust document is only half the job. You must fund it by retitling assets into the trust’s name — deeding real property, re-registering brokerage accounts, changing account ownership. An unfunded trust controls nothing: at death those assets are still in your name and still go through the county Surrogate’s Court, defeating the entire purpose. Funding is the step most do-it-yourself trusts get wrong.

Trustee duties under New York law (EPTL 11-2.3)

A New York trustee is a fiduciary bound by the Prudent Investor Act, EPTL 11-2.3: invest and manage trust assets prudently, diversify, consider the beneficiaries’ needs, avoid self-dealing, keep records, and account when required. A trustee who breaches these duties can be held personally liable. Choosing a trustee who is organized, impartial, and willing to serve is as important as the trust terms themselves.

Supplemental needs trusts (EPTL 7-1.12)

A supplemental (special) needs trust under EPTL 7-1.12 lets a person with disabilities benefit from inherited or gifted funds without losing means-tested government benefits like Medicaid and SSI. The trust supplements — rather than replaces — public benefits, paying for things those programs don’t cover. This is essential planning for any New York family with a disabled loved one.

Statewide probate-avoidance value

Because New York has no statewide Surrogate’s Court, a funded trust spares your family from opening a proceeding in your county of domicile — and from a second, ancillary proceeding if you also own property in another New York county. A single revocable trust can hold real property across multiple counties and pass all of it without any Surrogate’s Court filing. See how probate otherwise unfolds in the New York probate process guide and the statewide estate guide.

Trusts FAQ

Do I need both a will and a trust in New York? Usually yes — a “pour-over” will catches any assets left out of the trust and names guardians for minors. See wills.

Does a revocable trust protect assets from creditors or Medicaid? No. Only an irrevocable trust gives up enough control to offer protection. A revocable trust is for probate avoidance and incapacity.

Will a trust lower my New York estate tax? A revocable trust won’t, but irrevocable trusts (like ILITs and credit-shelter trusts) can. See New York estate taxes.

How long does the Medicaid lookback last in New York? Five years (60 months) for nursing-home Medicaid; community-care lookback rules are being phased in — verify current status.

Plan your New York trust with Morgan Legal Group

The right trust depends on your assets, your county, and your goals. Book a 30-minute consultation with Russel Morgan to find out which structure fits. Schedule now.