A trustee is the person or institution legally responsible for managing the assets held in a trust for the benefit of someone else. In plain terms, the trustee holds and invests trust property, follows the instructions in the trust document, and answers to the beneficiaries. Under New York’s Estates, Powers and Trusts Law (EPTL) Article 7, a trustee is a fiduciary — meaning the law holds the trustee to its highest standard of conduct. That standard breaks down into three core obligations: the duty to invest prudently (the prudent-investor standard under EPTL Article 11-A), the duty of loyalty, and the duty to account to beneficiaries. The rest of this post compares how those duties play out, weighs different trust types against one another, and explains why choosing the right trustee — and the right trust — matters so much in New York.
The Three Core Fiduciary Duties
Every trustee in New York carries the same baseline responsibilities, regardless of the size or type of the trust. Understanding these duties helps you compare candidates for the job and hold a serving trustee accountable.
1. The Duty to Invest Prudently (EPTL Article 11-A)
New York follows the prudent-investor standard codified in EPTL Article 11-A. A trustee must invest and manage trust assets as a prudent investor would — considering the purposes, terms, distribution requirements, and overall risk-and-return objectives of the trust. This is not a license to gamble, nor an excuse to leave everything in cash earning nothing. The trustee must diversify, weigh inflation and tax consequences, and make decisions in the context of the whole portfolio rather than judging each investment in isolation.
2. The Duty of Loyalty
A trustee must act solely in the interest of the beneficiaries. This duty of loyalty forbids self-dealing, conflicts of interest, and using trust property for personal gain. A trustee cannot buy trust assets at a discount, favor one beneficiary over another without authority, or commingle trust funds with personal accounts. When a trustee profits at the trust’s expense, beneficiaries can sue to recover the loss and remove the trustee.
3. The Duty to Account
Beneficiaries have the right to know what the trustee is doing with their money. New York imposes a duty to account — to keep accurate records and to provide periodic accountings showing income, expenses, distributions, and the current value of trust assets. Formal accountings can be presented to beneficiaries informally or, when disputed, judicially settled in the Surrogate’s Court. Trustees in New York are also entitled to statutory commissions; rather than inventing a figure, know that the SCPA and EPTL set out commission schedules that govern how a trustee is compensated.
Comparing the Main Trust Types — and the Trustee’s Role in Each
The trustee’s job changes depending on which kind of trust you create. Below is a side-by-side comparison of the most common New York trusts. To explore each in depth, see our Trusts Overview.
| Trust Type | Grantor Control | Avoids Probate? | Estate-Tax Savings? | Typical Use | Trustee’s Focus |
|---|---|---|---|---|---|
| Revocable Living Trust | Full — can amend or revoke | Yes | No (assets stay in taxable estate) | Probate avoidance, privacy, incapacity planning | Manage assets seamlessly during life and after death |
| Irrevocable Trust | Limited — generally cannot amend | Yes | Yes | Estate-tax reduction, asset protection, Medicaid planning (5-year look-back) | Preserve protections; strict separation from grantor |
| Supplemental / Special Needs Trust (SNT) | Varies by structure | Yes | Depends on structure | Protect a disabled beneficiary’s means-tested benefits | Distribute without disqualifying Medicaid/SSI |
Revocable Living Trust
A revocable living trust lets the grantor keep complete control — you can amend or revoke it at any time during life. Its main benefits are avoiding probate, preserving privacy, and managing your affairs if you become incapacitated. The important limitation: a revocable trust does not save estate tax, because the assets remain part of your taxable estate. The trustee (often the grantor at first) simply manages the assets and steps in smoothly upon incapacity or death.
Irrevocable Trust
An irrevocable trust generally cannot be amended once created. People use it for estate-tax reduction, asset protection, and Medicaid planning — though Medicaid eligibility is subject to the five-year look-back period. Here the trustee’s loyalty and separation from the grantor are critical: if the grantor retains too much control, the tax and protection benefits can collapse. This is the trust type that interacts most directly with New York’s estate tax.
Supplemental / Special Needs Trust
A special needs trust, authorized under EPTL 7-1.12, preserves means-tested public benefits like Medicaid and SSI for a disabled beneficiary. The trustee must distribute funds carefully — paying for supplemental quality-of-life expenses without giving the beneficiary direct access to cash that would disqualify them from benefits. This is the most discretion-intensive trustee role of the three.
Trust vs. Will: Why the Trustee Matters
A trust and a will do different jobs, and the comparison favors trusts on two points many families care about most: privacy and probate. A trust avoids probate and stays private; a will is a public document that must be probated in the Surrogate’s Court. With a will, an executor administers the estate through that court process. With a trust, the trustee administers assets privately and often far more quickly. For a fuller side-by-side, see our Trust vs. Will comparison, and learn how the day-to-day works on our Trust Administration page.
New York Estate Tax: The Cliff Every Trustee Should Watch
New York’s estate tax is uniquely unforgiving. For 2026, the basic exclusion amount is $7,350,000. But New York has a “cliff” at 105% of that exclusion — $7,717,500. Estates valued over the cliff lose the entire exemption, not just the excess. That single feature is why irrevocable trust planning and gifting strategies are so valuable for larger New York estates, and why a trustee managing a taxable estate must coordinate closely with tax counsel.
Frequently Asked Questions
Can I be the trustee of my own trust?
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. With an irrevocable trust, naming yourself can undermine the tax and asset-protection benefits, so an independent trustee is usually preferred.
Does a revocable trust lower my New York estate tax?
No. A revocable living trust avoids probate and protects privacy, but its assets remain in your taxable estate. To reduce estate tax, you generally need an irrevocable trust or other planning strategies.
How is a trustee paid in New York?
Trustees are entitled to statutory commissions. New York’s SCPA and EPTL set out commission schedules that determine compensation; the exact amount depends on the trust’s value and the services performed.
What happens if a trustee breaches their duties?
Beneficiaries can petition the Surrogate’s Court to compel an accounting, surcharge the trustee for losses, and seek removal. Breaches of loyalty, imprudent investing, and failure to account are the most common grounds.
Talk to a New York Trusts Attorney
Choosing the right trustee — and the right trust — is one of the most consequential estate-planning decisions you’ll make. The fiduciary duties under EPTL Articles 7 and 11-A protect your beneficiaries only when the structure is built correctly from the start.
Russel Morgan, Esq. and the team at Morgan Legal Group help New York families select trustees, draft trusts, and administer them in full compliance with New York law. Schedule a 30-minute consultation to discuss your situation.
Further reading from Morgan Legal Group: New York estate planning.