Most estate plans don’t fail because someone refused to plan. They fail because of small, avoidable mistakes — a trust that was signed but never funded, an “irrevocable” trust created five years too late, or a will the family assumed would skip probate. By the time anyone notices, the person who could have fixed it is gone.
At Morgan Legal Group, attorney Russel Morgan, Esq. and our team build trusts and wills for New Yorkers statewide — from New York City and Long Island to Westchester, the Hudson Valley, and Upstate. This page is organized around the mistakes we see most often, and how New York law (the Estates, Powers and Trusts Law, or EPTL) lets you avoid them.
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Mistake #1: Assuming a Will Avoids Probate
A will does not avoid probate. In New York, a will must be filed and proven in the Surrogate’s Court before anything can be distributed — a process that is public, can take many months, and exposes your affairs to anyone who looks.
A properly drafted and funded revocable living trust avoids that. Because the trust (not you personally) holds title to the assets, there is nothing for the Surrogate’s Court to probate, and the terms stay private. This is the core difference explained on our trust vs. will page.
| Feature | Will | Revocable Living Trust |
|---|---|---|
| Avoids probate? | No — must be probated in Surrogate’s Court | Yes — if properly funded |
| Public or private? | Public record | Private |
| Manages incapacity? | No | Yes — successor trustee steps in |
| Can be changed while you’re alive? | Yes | Yes (revocable) |
| Governing law | EPTL | EPTL Article 7 |
Mistake #2: Creating a Trust but Never Funding It
This is the single most common — and most expensive — mistake we correct. People sign a beautiful revocable living trust, put it in a drawer, and never retitle their home, accounts, or other assets into it. An unfunded trust controls nothing. Those assets still go through probate.
A revocable living trust only works when title is actually moved into it. Funding is not paperwork you can skip — it is the entire point.
Mistake #3: Expecting a Revocable Trust to Save Estate Tax
A revocable living trust gives you three real benefits: it avoids probate, protects your privacy, and provides incapacity management through a successor trustee. What it does not do is reduce estate tax. Because you keep the power to amend or revoke it, the law still treats those assets as part of your taxable estate.
To actually reduce estate tax or protect assets, you generally need an irrevocable trust — a separate tool with separate rules (see Mistake #5).
Mistake #4: Ignoring the New York Estate-Tax “Cliff”
New York does not work like the federal system. In 2026, the New York basic exclusion amount is $7,350,000. But New York applies a “cliff”: an estate valued at more than 105% of the exclusion — $7,717,500 — loses the entire exemption, not just the excess.
That means a relatively small difference in estate value can trigger tax on the whole estate. Families that plan around the cliff — often using irrevocable trusts or lifetime gifting — can preserve far more for their heirs than families that ignore it.
- 2026 NY basic exclusion: $7,350,000
- Cliff threshold (105%): $7,717,500
- Over the cliff: entire exemption is lost
Mistake #5: Waiting Too Long on an Irrevocable Trust
An irrevocable trust is the primary tool for estate-tax reduction, asset protection, and Medicaid planning. The catch: it generally cannot be amended once created, and Medicaid imposes a five-year look-back. Assets transferred into an irrevocable trust within five years of applying for Medicaid long-term care can trigger a penalty period.
The mistake is waiting until a health crisis to start. By then the five-year clock has barely begun. The earlier an irrevocable trust is funded, the sooner that look-back window closes. Learn more on our trusts overview.
Mistake #6: Leaving Assets Directly to a Disabled Beneficiary
Leaving an inheritance outright to a loved one who receives Medicaid or SSI can disqualify them from those means-tested benefits overnight. The fix is a Supplemental (Special) Needs Trust under EPTL 7-1.12, which holds assets for the disabled beneficiary’s benefit without counting as their personal resource. A properly drafted special needs trust preserves benefits while still enhancing quality of life.
Mistake #7: Choosing the Wrong Trustee — or No Successor
A trustee in New York is a fiduciary. Under the prudent-investor standard (EPTL Article 11-A), the trustee must invest with care, owes an undivided duty of loyalty, and has a duty to account to the beneficiaries. New York’s SCPA and EPTL also set out commission schedules that govern trustee compensation.
Naming a trustee who is unwilling, unqualified, or conflicted — or failing to name a successor — is a frequent source of family litigation. Thoughtful trustee selection and a clear administration plan, covered on our trust administration page, prevent most of these disputes.
How Morgan Legal Group Helps New Yorkers Plan
We serve clients across New York State — NYC, Long Island, Westchester, the Hudson Valley, and Upstate. Our process starts by identifying which of the mistakes above apply to your situation, then matching the right instrument (revocable trust, irrevocable trust, SNT, or will) to your goals under the EPTL.
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Frequently Asked Questions
Does a revocable living trust lower my New York estate tax?
No. Because you keep the power to amend or revoke it, the assets remain in your taxable estate. A revocable trust’s benefits are avoiding probate, privacy, and incapacity management — not tax savings. For estate-tax reduction you generally need an irrevocable trust.
What is the New York estate-tax cliff in 2026?
The 2026 NY basic exclusion is $7,350,000. If an estate exceeds 105% of that — $7,717,500 — it loses the entire exemption rather than just being taxed on the excess. Planning around this cliff is critical for larger estates.
Why isn’t signing my trust enough?
A trust must be funded — assets retitled into it — to work. An unfunded revocable trust avoids nothing, and those assets still pass through Surrogate’s Court probate. Funding is the step most do-it-yourself plans miss.
How does the Medicaid five-year look-back affect an irrevocable trust?
Transfers into an irrevocable trust within five years of applying for Medicaid long-term care can create a penalty period. Starting early closes that window sooner, which is why timing matters so much for irrevocable trusts.
What protects an inheritance for a disabled family member?
A Supplemental (Special) Needs Trust under EPTL 7-1.12 holds the inheritance for the beneficiary’s benefit without disqualifying them from Medicaid or SSI. See our special needs trust page.
This page is general legal information, not legal advice, and does not create an attorney-client relationship. New York trust law is governed by the EPTL and administered through the Surrogate’s Court. Confirm current figures with the New York State Department of Taxation and Finance.
Further reading from Morgan Legal Group: how an irrevocable trust works.