The short answer most New Yorkers are looking for: choose a revocable living trust if your priority is avoiding probate, keeping your affairs private, and managing your assets if you become incapacitated—while keeping full control to change your mind. Choose an irrevocable trust if your priority is reducing New York estate tax, protecting assets from creditors, or qualifying for Medicaid long-term care—and you are willing to give up control to get those benefits. Many New York families ultimately use both, or layer in a specialized trust, because the two tools solve different problems. Below, we answer the most common questions we hear from New Yorkers, with citations to the New York Estates, Powers and Trusts Law (EPTL).
How New York Trusts Work: The Basics
All express trusts in New York are governed by EPTL Article 7. A trust is a legal arrangement in which a grantor (the person creating the trust) transfers assets to a trustee, who manages them for the benefit of named beneficiaries. The defining difference between the two main types is one word: control.
- A revocable trust lets the grantor amend or revoke it at any time during life.
- An irrevocable trust generally cannot be changed or undone once it is funded.
That single distinction drives almost every practical difference in taxes, asset protection, and probate. For a fuller orientation, see our trusts overview.
Q&A: The Questions New Yorkers Ask Most
Q: Does a revocable trust avoid probate in New York?
Yes. This is the headline benefit. Assets properly titled in a revocable living trust pass to your beneficiaries without going through the Surrogate’s Court probate process. Probate in New York is public, can be slow, and exposes your estate’s details to anyone who looks. A revocable trust keeps the transfer private and outside the court system. It also provides built-in incapacity management: if you can no longer handle your affairs, your named successor trustee steps in without a court guardianship proceeding.
Q: Does a revocable trust save estate taxes?
No—and this is the single most common misconception. Because you keep full control over a revocable trust, the law still treats those assets as part of your taxable estate. A revocable trust offers probate avoidance, privacy, and incapacity protection, but it does not reduce New York estate tax.
Q: How does an irrevocable trust reduce estate tax?
When you transfer assets into a properly structured irrevocable trust and give up control, those assets can be removed from your taxable estate. That matters in New York because of the state’s unusual “cliff.”
For 2026, the New York basic exclusion amount is $7,350,000. But New York does not simply tax the amount above the exclusion. If your taxable estate exceeds 105% of the exclusion—$7,717,500—you lose the entire exemption, and the whole estate becomes taxable. Estates that fall over that cliff can owe dramatically more tax than estates just under it. Irrevocable trust planning is one of the primary tools used to keep an estate below the cliff.
Q: Which trust helps with Medicaid?
The irrevocable trust. To qualify for Medicaid long-term care coverage in New York, you generally cannot own the assets you wish to protect. Transferring assets to an irrevocable trust can shield them—but only if it is done early enough. New York applies a 5-year look-back period for institutional Medicaid: transfers made within five years of applying can trigger a penalty period of ineligibility. A revocable trust offers no Medicaid protection, because the assets are still considered yours.
Q: What if I have a disabled loved one?
Consider a Supplemental (Special) Needs Trust (SNT), authorized under EPTL 7-1.12. An SNT lets you set aside funds for a disabled beneficiary without disqualifying them from means-tested benefits like Medicaid or SSI. Leaving money to a disabled person outright—or through a standard trust—can cause them to lose those benefits. A properly drafted special needs trust preserves eligibility while improving quality of life.
Side-by-Side Comparison
| Feature | Revocable Living Trust | Irrevocable Trust |
|---|---|---|
| Can you change or revoke it? | Yes, anytime | Generally no |
| Avoids probate? | Yes | Yes |
| Provides privacy? | Yes | Yes |
| Manages incapacity? | Yes | Yes (depending on terms) |
| Reduces NY estate tax? | No | Yes, if structured properly |
| Protects from creditors? | No | Yes, generally |
| Helps with Medicaid? | No | Yes (subject to 5-year look-back) |
| Assets in your taxable estate? | Yes | No (when control is given up) |
Trust vs. Will: A Related Question
People often ask whether they need a trust at all, or whether a will is enough. A will must be filed and probated in the Surrogate’s Court—a public proceeding. A trust avoids probate and stays private. The two are not mutually exclusive; most well-built New York estate plans include a “pour-over” will alongside a trust. Read more on our trust vs. will page.
Who Runs the Trust? Trustee Duties
Whichever trust you choose, the trustee carries serious legal responsibilities. Under New York’s prudent investor standard (EPTL Article 11-A), a trustee must invest assets prudently. The trustee also owes a duty of loyalty to beneficiaries and a duty to account—to keep records and report to beneficiaries. Trustee commissions are set by statutory schedules under the SCPA and EPTL. Sound trust administration is essential to keeping the trust valid and the tax and asset-protection benefits intact.
Frequently Asked Questions
Q: Can I be the trustee of my own revocable trust?
A: Yes. With a revocable living trust, you typically serve as your own trustee during your lifetime and name a successor trustee to take over at incapacity or death.
Q: Can an irrevocable trust ever be changed?
A: As a rule, no—that rigidity is what produces the tax and asset-protection benefits. Limited modifications may be possible in narrow circumstances, but you should never count on changing it.
Q: If I create an irrevocable trust now, when does Medicaid protection begin?
A: For institutional Medicaid, transfers are subject to a 5-year look-back under New York rules. Planning early is critical—the protection is strongest five years after the transfer.
Q: Do I need both a revocable and an irrevocable trust?
A: Many New Yorkers do. A revocable trust handles probate avoidance and incapacity, while an irrevocable trust addresses estate tax, Medicaid, or asset protection. The right combination depends on your assets, your family, and your goals.
Talk to a New York Trusts Attorney
Choosing between a revocable and irrevocable trust—especially with New York’s estate-tax cliff and Medicaid look-back in play—is a decision worth getting right the first time. Russel Morgan, Esq. and the team at Morgan Legal Group design and administer trusts for families across New York State.
Schedule your 30-minute consultation with Russel Morgan, Esq. to find out which trust fits your situation.
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