Decanting a ‘HEMS Only’ Trust in Favor of an SNT

In 1992, New York became the first state in the nation to enact a decanting statute, namely, New York Estates, Powers and Trusts Law (EPTL) 10-6.6. The statute subsequently was modified several times. The 2011 amendment was notable because it greatly liberalized the statute’s application. Today, New York’s decanting statute is a tool frequently used by practitioners.

One widely welcomed feature of the 2011 amendment was its attempt to facilitate decantings in favor of a supplemental needs trust (SNT) that conforms to the provisions of EPTL 7-1.12. In that regard, it codified New York’s emerging public policy of allowing reformation of certain irrevocable trusts so they could qualify as SNTs when appropriate.

Read more

This article appeared in the Trusts And Estates Law Section Journal, a publication of the New York State Bar Association.