Yes. A properly created and properly funded revocable living trust avoids probate in New York for the assets it holds. When you transfer assets into a living trust during your lifetime, those assets are no longer owned by you as an individual — they are owned by the trust. Because there is nothing to “prove” in the Surrogate’s Court, your successor trustee can distribute those assets to your beneficiaries privately, without the delay, expense, and public exposure of the probate process. The key word, however, is funded: an unfunded trust — one you signed but never retitled assets into — avoids nothing.
Below, we answer the questions New Yorkers most often ask our attorneys at Morgan Legal Group, using New York’s Estates, Powers and Trusts Law (EPTL Article 7), the statute that governs trusts across the state.
What Is a Living Trust, and Why Does It Skip Probate?
A living trust (also called a revocable living trust or inter vivos trust) is a legal arrangement you create while you are alive. You typically serve as your own trustee, keeping full control. You can amend it, add or remove assets, or revoke it entirely at any time.
Probate is the court-supervised process of validating a will in the Surrogate’s Court and authorizing an executor to act. It only applies to assets that pass through your will — that is, assets you owned in your own name at death. Because trust assets are titled in the name of the trust rather than in your individual name, they never enter your probate estate. That is the mechanical reason a trust avoids probate.
The Core Difference: Trust vs. Will
| Feature | Living Trust | Will |
|---|---|---|
| Goes through Surrogate’s Court probate | No | Yes |
| Public record | No — private | Yes — public |
| Effective during incapacity | Yes | No (will only operates at death) |
| Can be changed during your life | Yes (revocable) | Yes |
| Requires funding to work | Yes | No |
For a deeper comparison, see our Trust vs. Will guide.
What Are the Real Benefits of a Living Trust in New York?
A revocable living trust delivers three primary benefits:
- Avoiding probate — your beneficiaries inherit faster and without court involvement.
- Privacy — unlike a probated will, which becomes a public Surrogate’s Court record, a trust is never filed publicly.
- Incapacity management — if you become unable to manage your affairs, your named successor trustee steps in immediately, without the need for a court-appointed guardian.
You can explore each of these in our Revocable Living Trust overview.
Does a Living Trust Save New York Estate Tax?
No — a revocable living trust does not save estate tax. This is one of the most common misconceptions we correct. Because you keep full control over a revocable trust, New York still counts those assets as part of your taxable estate.
For 2026, New York’s basic exclusion amount is $7,350,000. New York also has a notorious “cliff.” If your taxable estate exceeds 105% of the exclusion — $7,717,500 — you lose the entire exemption, and the whole estate becomes taxable, not just the excess. Estates near this threshold need careful planning.
If estate-tax reduction or asset protection is your goal, an irrevocable trust is the tool — not a revocable living trust. Because you give up control over assets in an irrevocable trust, those assets can be removed from your taxable estate. Learn more on our Irrevocable Trust page.
Can a Trust Help with Medicaid Planning?
Yes — but only an irrevocable trust. New York’s Medicaid program imposes a five-year look-back for institutional (nursing home) care. Transfers into an irrevocable trust must generally be completed at least five years before applying for long-term-care Medicaid to avoid a penalty period. A revocable trust provides no Medicaid protection because the assets remain available to you.
What About a Disabled Beneficiary?
If you want to leave assets to a loved one with disabilities without disqualifying them from means-tested benefits like Medicaid or SSI, you need a Supplemental (Special) Needs Trust under EPTL 7-1.12. An SNT holds funds for the beneficiary’s supplemental needs while preserving their public benefits. See our Special Needs Trust page for details.
Who Manages the Trust, and What Are Their Duties?
The trustee manages trust assets and owes strict fiduciary duties under New York law, including:
- The prudent-investor standard (EPTL Article 11-A), requiring sound, diversified investment management.
- A duty of loyalty — acting solely in the beneficiaries’ interest.
- A duty to account — keeping records and reporting to beneficiaries.
Trustees may be entitled to commissions under the schedules set out in the EPTL and the Surrogate’s Court Procedure Act (SCPA). Our Trust Administration team guides successor trustees through these obligations after a grantor’s death or incapacity.
Frequently Asked Questions
Q: Do I still need a will if I have a living trust?
A: Yes. We pair every living trust with a “pour-over will” that captures any assets you forgot to fund into the trust and directs them into it. The pour-over will may require a brief probate for those leftover assets, which is exactly why funding the trust fully is so important.
Q: Is a living trust more expensive than a will?
A: A trust usually costs more to set up than a simple will, but it can save your family significant probate costs, delay, and legal fees later. The trade-off favors a trust for most New Yorkers with real estate or substantial assets.
Q: Does a living trust protect my assets from creditors or lawsuits?
A: A revocable trust does not, because you retain control. Asset protection requires an irrevocable trust, where you relinquish control.
Q: What happens if I move out of New York?
A: A validly created New York trust generally remains valid, but you should have it reviewed, since estate-tax and trust rules vary by state.
Talk to a New York Trusts Attorney
A living trust is a powerful tool — but only when it is drafted correctly and fully funded. The right structure depends on your goals: probate avoidance, privacy, tax reduction, Medicaid planning, or protecting a vulnerable beneficiary.
Russel Morgan, Esq. and the team at Morgan Legal Group help New Yorkers statewide design trusts that actually do what they promise. To review your situation and find out whether a living trust is right for you, schedule a consultation today.
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Explore more: Trusts Overview · Revocable Living Trust · Irrevocable Trust
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