Picture a Park Slope couple who have built a comfortable estate: a brownstone, retirement accounts, and a modest brokerage portfolio. Their daughter is 22 and brilliant, but she has never managed money and tends to spend whatever lands in her account. If both parents died tomorrow, New York law would hand her everything outright. That outcome worries them more than the estate tax does. This post walks through how New York families in that situation actually solve the problem.
What Happens If You Do Nothing
If you die without a will, New York’s intestacy rules under EPTL Article 4 distribute your assets by formula. A child who is 18 or older simply receives their share outright, with no strings attached. Even with a basic will, leaving property to a young or impulsive heir “outright and free of trust” means they control the full amount the day the Surrogate’s Court in their borough finishes administration. For a 22-year-old in Manhattan, that can mean a six-figure check arriving before they have learned to budget rent.
The Trust Solution Under EPTL Article 7
New York’s trust law lives in EPTL Article 7, and it lets you write rules that outlive you. Instead of a lump sum, our Brooklyn couple can direct their assets into a trust created in their will (a testamentary trust) or in a separate revocable living trust. A trustee they choose holds the money and releases it under terms they set. The daughter gets the benefit of the inheritance without holding the checkbook before she is ready.
Staged Distributions and Spendthrift Language
A common approach for a young heir is staged distribution: the trustee pays for health, education, and reasonable support while the beneficiary is young, then distributes principal in tranches, say one-third at 25, one-third at 30, and the balance at 35. For an heir with poor money habits or exposure to creditors, parents add a spendthrift provision. New York courts generally enforce spendthrift clauses, which means a creditor or an aggressive ex-spouse usually cannot reach trust principal before the trustee actually pays it out. The trustee can also retain discretion, releasing funds only for purposes you describe rather than on demand.
Choosing the Right Trustee in New York
The trustee is the whole game. Naming the spendthrift heir’s well-meaning but financially stretched uncle defeats the purpose. Many NYC families name a trusted relative as co-trustee alongside a professional or corporate trustee, balancing personal knowledge with financial discipline. If your heir has special needs and relies on Medicaid or SSI, the analysis changes entirely: a supplemental needs trust under EPTL 7-1.12 is designed to provide for that person without disqualifying them from benefits, and it must be drafted precisely.
A Note on Taxes
Protecting an heir and saving estate tax are separate goals. A revocable trust controls timing and management but does not reduce the New York estate tax; in 2026 the New York exclusion is $7,350,000, with a cliff that fully taxes estates above $7,717,500. If your estate approaches those numbers, irrevocable planning is a different conversation. For most families, the priority is simply making sure the money lasts.
Talk to a New York Attorney
Spendthrift clauses, trustee selection, and supplemental needs language all turn on specific New York statutes and on the facts of your family. This article is general information, not legal advice. Before you finalize a plan to protect a young or spendthrift heir, speak with a qualified New York estate planning attorney who can tailor the trust to your situation and the Surrogate’s Court that will oversee it.
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