A trust is a legal arrangement in which you (the grantor) transfer assets to a trustee to hold and manage for your beneficiaries under terms you set. In New York, the core benefit of a trust is probate avoidance: assets titled in a properly funded trust pass directly to your beneficiaries without going through the Kings County Surrogate’s Court — saving time, court fees, and the loss of privacy that comes with a public probate file.
For Brooklyn homeowners whose brownstones have appreciated into seven figures, a trust is often the single most valuable planning tool. Here is how trusts work under New York’s EPTL.
Revocable living trust vs. will — side by side
Definition — Grantor: The person who creates a trust and transfers assets into it (also called settlor or trustor).
| Feature | Will | Revocable Living Trust |
|---|---|---|
| Avoids probate? | No | Yes (if funded) |
| Private? | No — becomes a public court file | Yes — no public filing |
| Effective during incapacity? | No | Yes — successor trustee steps in |
| Cost to set up | Lower | Higher upfront |
| Control while alive | Full | Full (you can amend or revoke) |
| Court oversight | Surrogate’s Court | None unless disputed |
For a Park Slope or Brooklyn Heights townhouse, the privacy and probate-avoidance columns are decisive — neighbors and speculators cannot pull your estate file.
Irrevocable trusts and Medicaid Asset Protection Trusts
An irrevocable trust cannot be freely amended once created, but in exchange it can remove assets from your taxable estate and shield them from long-term-care costs.
A Medicaid Asset Protection Trust (MAPT) is the most common irrevocable trust for Brooklyn families. By transferring the home into a MAPT and surviving the five-year lookback, the property is protected from Medicaid estate recovery while you keep the right to live there. Timing is everything: the lookback runs from the date of transfer, so a brownstone moved into a MAPT this year is protected five years from now — not retroactively.
New York trust types at a glance
| Trust type | Revocable? | Primary purpose |
|---|---|---|
| Revocable living trust | Yes | Probate avoidance, incapacity management |
| Irrevocable / MAPT | No | Medicaid & estate-tax protection (5-yr lookback) |
| Supplemental needs trust (EPTL 7-1.12) | Varies | Provide for a disabled beneficiary without losing benefits |
| Testamentary trust | Created by will | Manage assets for minors/heirs after death |
Definition — Corpus: The principal property held in a trust, as distinct from the income it produces.
Why funding a trust is the step that fails
A trust controls only the assets actually retitled into it. An unfunded trust — signed but never deeded — does nothing. Funding a Brooklyn home means recording a new deed transferring the property from you individually to you as trustee. Skip this and your brownstone still goes through probate. Funding is the most overlooked, most consequential step.
Trustee duties under New York law
Definition — Trustee: The person or institution that holds legal title to trust property and must manage it for the beneficiaries.
A trustee is a fiduciary. Under New York’s Prudent Investor Act (EPTL 11-2.3), the trustee must invest with care, diversify, act impartially among beneficiaries, and avoid self-dealing. Breaching these duties exposes the trustee to personal liability — the same standard that governs an executor.
The Brooklyn angle: trusts and the appreciated row house
The Brooklyn problem is not co-op shares (that is Manhattan) — it is real property that has exploded in value. A multi-family townhouse in Bedford-Stuyvesant bought for $150,000 may now be worth $2.5 million. Two things follow:
- Probate exposure. Real property in your sole name must pass through Kings County Surrogate’s Court. A revocable trust routes it around the court.
- Basis and estate tax. Assets held until death generally receive a stepped-up basis, wiping out decades of capital-gains exposure — but the same appreciation can push the estate over the NY estate-tax cliff. A trust strategy must balance both.
Definition — Beneficiary: A person or entity entitled to receive the benefits of trust property under its terms.
Frequently asked questions
Do I need a trust if I already have a will? A will does not avoid probate; a trust does. If your main asset is an appreciated Brooklyn home, a revocable trust usually adds real value on top of a will.
Does a revocable trust protect against nursing-home costs? No. Only an irrevocable trust like a MAPT shields assets from Medicaid — and only after the five-year lookback.
Can I be my own trustee? Yes, for a revocable living trust you are typically the initial trustee and name a successor for incapacity and death.
Does a trust avoid New York estate tax? A revocable trust does not reduce estate tax. Certain irrevocable trusts (credit-shelter, ILITs) can — see estate taxes.
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