By Eric Berman, REALTOR® | The Eric Berman Team at Compass
TL;DR:
Yes, and one of the main reasons people put a home in a trust is that it can be sold without going through Surrogate's Court. The trustee sells, using a certification of trust to prove authority rather than disclosing the entire instrument. What deserves attention before anything else isn't the process — it's the tax outcome, which was largely determined when the trust was drafted. Whether it's revocable or irrevocable, and whether the grantor is living or deceased, decides whether the property receives a stepped-up basis. On a long-held Port Washington home that difference can run to hundreds of thousands of dollars.
Ask the Tax Question First
Most guidance on trust sales walks through the mechanics and never mentions the number that matters most.
A revocable living trust is generally disregarded for income tax purposes during the grantor's lifetime — the grantor is treated as owning the property directly. That has two consequences. A grantor selling while living is typically taxed as if they owned it outright, including access to the primary-residence exclusion where the ownership and use tests are met. And on the grantor's death, the property generally receives a stepped-up basis to fair market value as of that date, the same as an outright inheritance.
An irrevocable trust behaves differently, and the difference depends on how it was drafted. Some are structured so trust assets remain includable in the grantor's estate and receive a step-up. Others are not, and the trust takes the grantor's original cost basis — which on a home bought decades ago in Port Washington means an enormous taxable gain when it sells.
The practical difference is stark. A property purchased for $85,000 and worth $1.3 million produces a modest gain if the basis stepped up, and something close to $1.2 million of gain if it didn't.
This should be the first conversation, not the last. A trustee who reaches a closing table without knowing which situation applies has lost the opportunity to plan around it. The fuller treatment of how gain is calculated covers the mechanics, and this specific question belongs with an estate attorney and a CPA together.
Selling Before or After the Grantor's Death
Where the grantor is living and the trust is revocable, there's often a genuine choice, and it's worth understanding what each path produces.
Selling during the grantor's lifetime generally means the transaction is treated as the grantor's own. Where the ownership and use tests are met, the primary-residence exclusion is typically available — $250,000 for a single filer, $500,000 for a married couple filing jointly. The basis is what the grantor paid plus improvements.
Selling after death generally means no exclusion, since the trust or its beneficiaries aren't occupying the property as a residence — but the basis has stepped up, which for a long-held home is usually worth far more than the exclusion would have been.
Neither is universally better. A home with modest appreciation may do better sold during lifetime with the exclusion applied. A home held forty years in Port Washington almost certainly does better with the step-up.
What matters is that families frequently make this decision by default — selling when circumstances force it rather than when the arithmetic favors it. Where there's flexibility, the arithmetic is worth running. Where a family is considering transferring a home to children instead, the downsizing decision covers the gifting trap that carries the same logic.
Proving Authority Without Handing Over the Trust
The mechanical question is whether the trustee can convey, and the answer comes from the trust instrument itself.
The trust agreement defines the trustee's powers, including whether they may sell real property, whether beneficiary consent is required, and whether any conditions attach. A revocable trust typically grants the grantor-trustee broad authority. An irrevocable trust may impose real constraints, and in some cases court involvement is required.
The certification of trust is how this gets proven in practice, and it's worth understanding because trustees are often reluctant about the alternative. Rather than handing the entire trust instrument — a private document containing beneficiary names, distribution terms, and family financial detail — to a buyer's attorney and title company, the trustee provides a certification: a shorter document confirming the trust exists, who the trustee is, and that they hold authority to convey.
Two things follow. The buyer's title company has to accept it, and their requirements vary. And it should be prepared and confirmed acceptable before listing, not produced at the closing table. A title company that rejects the certification days before closing creates a problem with no good solution.
Successor trustees need to establish their own authority. Where the original trustee has died or become incapacitated, the documentation proving succession — a death certificate, a physician's certification, or whatever the instrument requires — has to be assembled and accepted. That's another pre-listing item.
Where multiple beneficiaries exist, their consent may or may not be required depending on the instrument. Disputes among them are the most common source of delay, and they're an attorney matter rather than something the trustee resolves informally.
The Part That Works Like Any Other Sale
Once authority is established, the transaction proceeds normally — and one Port Washington issue applies with full force.
Permits and certificates of occupancy don't care about the trust. After contracts are signed, the buyer's attorney orders municipal searches from whichever authority governs the address. The peninsula spans several incorporated villages — Baxter Estates, Manorhaven, Flower Hill, Sands Point, and Port Washington North among them — plus unincorporated areas under the Town of North Hempstead, each with its own building department. An unclosed permit from years ago surfaces regardless of how the property is titled.
This lands harder in a trust sale than in an ordinary one. A trustee dealing with a village building department on behalf of a trust, possibly while beneficiaries wait and possibly without personal knowledge of when the work was done, is in a worse position than an owner-occupant. Calling the building department before listing is worth more here than usual. The breakdown of which rules apply where sorts out the jurisdictions.
Disclosure is the other item. The Property Condition Disclosure Statement has been mandatory since the March 20, 2024 amendment — the 56-question form is required and the prior five hundred dollar credit alternative was eliminated. Estates carry an exemption where the executor never occupied the property; whether that extends to a trustee is a question for the attorney rather than something to assume in either direction. Where a trustee has no personal knowledge, "Unknown" is a permitted answer on the questions that apply. The full treatment of what the form asks covers how to answer honestly.
Beyond that: the same pricing, the same marketing, the same costs. New York State Transfer Tax at four dollars per thousand, attorney fees, and commission all apply as usual.
A Worked Example
Consider a composite case — a Port Washington colonial held in a revocable living trust, the grantor recently deceased, with an adult child serving as successor trustee.
The first conversation was with the estate attorney and the family's CPA together, before any listing discussion. The trust was revocable, which meant the property received a stepped-up basis to its value at the date of death. A home purchased in 1984 and worth roughly $1.25 million produced modest gain rather than the substantial figure the family had feared.
The attorney prepared a certification of trust and, importantly, confirmed with a title company in advance that it would be accepted along with the documentation establishing successor trusteeship. That confirmation took two weeks and would have taken longer under a contract deadline.
A call to the village building department turned up a 2010 permit for a rear addition never closed out. The successor trustee had no knowledge of the work, having never lived there. Resolving it took eight weeks, with the trust covering roughly $2,700 in fees and correction.
None of that was dramatic. All of it happened before a buyer existed, which is why it stayed uncomplicated.
Where to Start
Determine the trust type and, with an estate attorney and a CPA together, establish what the basis is. That answer shapes everything downstream. Confirm the trustee's authority to convey and whether beneficiary consent is required. Have the attorney prepare a certification of trust and confirm in advance that a title company will accept it, along with any successor trustee documentation. Call the village or town building department and ask what's on file. Work through the disclosure question with the attorney rather than assuming an exemption applies.
Then it's an ordinary sale. Trustees wanting a read on the property's current value can start with a quiet look at present figures.
The Honest Bottom Line
A trust-held Port Washington home sells like any other once the paperwork is settled, and the paperwork is more settleable in advance than families expect.
What deserves the most attention is the least visible. The tax outcome was largely determined when the trust was drafted, possibly decades ago, and a trustee who understands it early can plan around it. A trustee who discovers it at closing cannot.
The two documents worth handling before anything is listed are the certification of trust — confirmed acceptable to a title company — and whatever establishes successor authority. Both are straightforward with time and difficult without it.
For anyone working through a trust sale, with no pressure attached, that conversation is available whenever the timing suits.
This is general information, not legal or tax advice. Trust taxation and trustee authority depend entirely on how the specific instrument was drafted, and general statements carry real exceptions. Consult an estate attorney, a CPA, and a New York real estate attorney about your circumstances.
FAQs
Does a home in a trust avoid Surrogate's Court?
Generally yes, and that's a primary reason people place a home in a trust. Property held in a properly funded trust passes according to the trust's terms rather than through probate, which means the trustee can sell without waiting for Letters Testamentary or Letters of Administration. That typically saves the six to twelve weeks a Surrogate's Court proceeding takes in an uncontested case. The trustee still has to prove authority to convey, usually through a certification of trust that the buyer's title company must accept.
Does a home in a trust get a stepped-up basis?
It depends on the trust type and how it was drafted, and this is the most consequential question in a trust sale. A revocable living trust is generally disregarded for tax purposes during the grantor's lifetime, and on the grantor's death the property typically receives a stepped-up basis to fair market value — the same as an outright inheritance. An irrevocable trust may or may not, depending on its structure. On a long-held Port Washington home the difference can run to hundreds of thousands of dollars, so it belongs in the first conversation with an estate attorney and a CPA.
What is a certification of trust?
A shorter document confirming that the trust exists, identifying the trustee, and establishing that they hold authority to convey — provided in place of the full trust instrument. It matters because the alternative is handing a private document containing beneficiary names, distribution terms, and family financial detail to a buyer's attorney and title company. Two practical points: the buyer's title company has to accept it and requirements vary, and it should be prepared and confirmed acceptable before listing rather than produced at closing.
Can a trustee sell without the beneficiaries' consent?
It depends on the trust instrument, which defines the trustee's powers. Some grant broad authority to sell real property without consent; others require beneficiary approval, and in certain irrevocable trust situations court involvement may be needed. A revocable trust typically gives the grantor-trustee broad authority. Where multiple beneficiaries exist and disagree, that's the most common source of delay in a trust sale, and it's a matter for the estate attorney rather than something the trustee resolves informally.
Does a trustee have to complete the New York disclosure form?
That's a question for the attorney rather than something to assume. The Property Condition Disclosure Statement has been mandatory since the March 20, 2024 amendment, with the prior five hundred dollar credit alternative eliminated. Estates carry an exemption where the executor never occupied the property, but whether that extends to a trustee depends on circumstances and should be confirmed rather than presumed in either direction. Where a trustee does complete it and lacks personal knowledge, "Unknown" is a permitted answer on the questions that apply.
By Eric Berman, REALTOR® | The Eric Berman Team at Compass
Eric Berman | Long Island & Queens Associate Broker | Compass
1468 Northern Blvd, Manhasset, NY 11030
(917) 225-8596 | eric@ericbermanre.com | theericbermanteam.com
