Paul O. Dillon, Attorney at Law

Why Create a Pet Trust?

Media mogul Oprah Winfrey has a trust fund for her dogs, as revealed in 2007 by a source to an Australian women’s magazine. How much she left to her beloved animal companions is thought to be in the millions, according to a recent article from Pets Radar, “Oprah’s dogs will inherit a $30 million fortune—here’s why.” However, you don’t need to be a billionaire to want to care for your pets using a pet trust.

A pet trust is a legally binding contract used to specify money to care for a pet in case of incapacity or death of the human owner. The trust is funded to care for the animal’s life and should include specific instructions for how the pet will be cared for. An experienced estate planning attorney can create a pet trust to comply with your state’s laws.

When creating a pet trust, consider how much money will be needed to pay for the pet’s care, considering the type of pet, their age, life expectancy and whether they have or might have health issues in the future. If you own multiple pets, the pet trust must address all their needs.

The funds are used to cover veterinary bills, food, grooming, housing and compensation, if needed, for a caretaker. The trust will also need to include a contingency provision in case the primary caregiver becomes incapacitated or can’t care for the pets and someone else needs to step into the role.

The pet trust should also include plans for what happens when the pet dies. Do you want them to be cremated or buried, and what do you want to happen to any remaining funds in the trust? The people who love their pets enough to create a pet trust often decide to leave any remaining funds in the trust to a local animal shelter.

A common question in creating a pet trust is this: should the same person who is taking care of the pets also oversee the assets in the trust? The trustee oversees the assets and pays the caretaker. The problem is, if the caretaker doesn’t use the funds to care for the pet as you’ve outlined in the trust, who will monitor the money or the care of the pet? Many people prefer to have two different people involved, just in case.

Can you simply ask an adult child to take care of your beloved pet if you become sick or if you die before the pet? In theory, the answer is yes. However, your adult child or anyone you ask to care for your pet is under no legal obligation, unless you’ve created a pet trust and they’ve agreed to take on the role of either caretaker or trustee or both.

If you don’t have someone to care for your pet, check with your local animal shelter. No-kill shelters often have arrangements where a fee or donation is used to ensure lifetime pet care for a companion animal.

Your estate planning attorney will know how to create a pet trust to care for your furry companions, providing you with the peace of mind knowing they won’t end up in a shelter or living on the streets.

Reference: Pets Radar (April 4, 2025) “Oprah’s dogs will inherit a $30 million fortune—here’s why”

What Happens When a Pet Outlives Its Owner?

While leaving millions to a pet is a little extreme, regular people who love their dogs, cats, parrots and other companion animals are wise to make plans to protect their pets in case they become incapacitated or die before their pets. A recent article from MSN, “Things That Happen When a Pet Outlives Its Owner,” looks at what can happen to pets after their owners die.

If plans for the pet, including funding for care, aren’t made, there’s no way to be sure the pet will avoid the fate of many senior animals: an animal shelter. Making matters worse, senior dogs have a lower adoption rate, putting them at risk of remaining at the shelter for the rest of their lives or being euthanized.

If your family loves animals, or you have close friends who are animal people, your pet might get lucky and be adopted by a family member or friend. However, this doesn’t always work out. Even well-meaning friends may have allergies or a lifestyle that conflicts with having a pet. There may also be behavior problems because the pet is grieving the loss of their owner in a new environment, and it may become difficult for the friend or family member to take care of.

Clear instructions about the care of your pet and money to provide for their food, veterinary bills and other costs need to be set down in a legally enforceable document if your pet is to avoid being passed like a hot potato from person to person or to end up in a cage in a shelter.

Pets are considered property, so you can’t leave money directly to them. You could name a caretaker in your will and leave them a certain amount of money to care for the pet. However, the will may not be enforceable. They may use the money for other things while your dog is neglected.

If you don’t name a caretaker, the court may decide where your pet will end up. This can delay the pet’s being placed into a home environment while decisions are being made. Even short shelter stays can be traumatic for animals that are used to living with people.

Exotic pets pose a different set of problems. A large bird with a 50-year lifespan needing a special diet and habitat will not be easy to rehome. A large tortoise with a 100-plus-year lifespan will probably end up living in an animal sanctuary if one can be found and if the sanctuary can afford to take on the cost and responsibility.

An estate planning attorney can create a pet trust in most states for several purposes. The pet trust should be funded with money for the pet's care. A trustee oversees the money, while a caretaker is named in the trust to have physical custody of the pet.

Some shelters, especially no-kill shelters, have arrangements where a donation is required to ensure lifetime care in a suitable environment. The donations often incorporate a Charitable Lead or Charitable Remainder Trust.

Planning for your pet’s future will provide peace of mind, knowing your beloved companion will have a happy life even when you aren’t there.

Reference: MSN (Jan. 30, 2025) “Things That Happen When a Pet Outlives Its Owner”

What are Best Practices for Estate Planning?

You’ll be able to avoid common problems and have a more effective estate plan by being mindful of some simple but important details, according to a recent article, “7 Estate Planning Best Practices,” from Kiplinger.

Name more than one person for essential roles in your estate plan. An executor is the person who will carry out the instructions in your will. What happens if they cannot serve or decide they don’t want to? Always make sure to name an executor and a successor executor. The same is true for your Power of Attorney, Healthcare Agent, and, if you have a Revocable Trust, your successor trustee. If most of the important people in your estate plan are around the same age as you, it’s wise to name younger people as backups.

Talk with your loved ones about where your estate planning documents can be found, including how to access them. They’ll need to be able to find them, for starters, and then learn how to open them if they are in a secure location. Don’t surprise loved ones by adding turmoil to their grief.

Talking about your estate plan includes talking about the intentions behind the estate plan. You may wish to create a letter of intention, explaining your reasoning behind the estate plan. It’s not legally enforceable, but it might preclude ambiguity and possibly prevent family disputes. If you don’t, you add the possibility of family fights, litigation and even the dissolution of family relationships over the generations. People fight about money, whether we like to acknowledge this or not.

Work with an experienced estate planning attorney who knows your state’s laws. Estate planning laws are state-specific, and someone who is a terrific attorney in Colorado won’t necessarily know the law of Texas. If you move to a different state, you’ll also need to update documents to be sure they will work in your new home.

If you’re a pet owner, don’t neglect planning for your pets. Your will can include a provision about caring for your pets and include a bequest to care for your pets. However, this is not enforceable. On the other hand, a pet trust can name a trustee to manage the funds for the pet’s benefit and name a person to serve as a caretaker.

Don’t wait until a medical emergency to give your healthcare providers copies of relevant estate planning documents. Ask your estate planning attorney and your doctor about giving your healthcare team documents like a living will, power of healthcare attorney, living will and other related documents. Most healthcare systems today have patient information portals where they can be stored.

Did you create a trust but haven’t yet funded it? If you don’t retitle your assets so they are inside of the trust, your trust won’t perform as intended. This last step has to happen for the trust to be effective.

Review your estate plan on a regular basis. Most estate planning attorneys recommend reviewing an estate plan every three to five years, and more often if there have been large “trigger” events like marriage, divorce, death, or birth. If you move to a new state, you’ll also need a review to be sure your estate is still valid in the new state.

Your estate is like your car: without regular maintenance, it will not perform well and, over time, will stop running. Call your estate planning attorney to make sure that your documents are in order for the new year.

Reference: Kiplinger (Jan. 6, 2025) “7 Estate Planning Best Practices”

Estate Planning can Include Pets as Well as ‘Regular’ People

Who could forget the headlines when billionaire Lenora Helmsley was found to have set aside $12 million for her dog, aptly named Trouble, after she passed? You don’t have to be a billionaire to want to protect your animal companion, says a recent article from The Wall Street Journal, “Putting Pets in Your Will Is No Longer Just for Eccentric Billionaires.”

One family created their will with instructions for caring for their two young children, naming a guardian and a plan for distributing their assets, a basic part of an estate plan. They’ve also planned for their two dogs, naming a sister as their caretaker.

No matter how much you love your dog, cat, horse, or mouse, they are legally considered personal property. If there are no directions in the will for who will take care of your pets when you die, they will go to whoever inherits your property, with no guarantee of what will happen to them. Worse, if you die without a will, the laws of your state will determine what happens to them.

Many pets whose owners die end up at shelters, and not every city has no-kill shelters. This situation is not great for older pets or those with medical conditions who aren’t as adaptable as puppies or kittens. Large birds, like parrots, can live as long as humans, making plans for their future especially important. Other animals end up abandoned, living on the streets.

In other words, don’t assume your family members love your pet as much as you do. You need to make a plan for their future.

Some shelters have programs helping people include pets in their wills, often tied to making a bequest to be made to the shelter to fund the pet’s care.

When parents pass, and a guardian has been named to care for children, there is usually a certain degree of court supervision. However, the same isn’t true for pets. If you choose to name a pet’s caretaker in the will and provide assets for the pet’s care, there’s no one watching to be sure your beloved animal companion is being cared for with the money you provided.

An enforceable alternative is the creation of a pet trust. The caretaker and the trustee should be different people. A trustee’s fiduciary duty is to ensure that the assets in the trust are being used for their intended purpose. The caretaker is responsible for the pet's overall quality of life.

Your estate planning attorney will be able to create a trust to care for your beloved animal companions, so they will be safe and well cared for. You don’t have to be a billionaire to make this happen.

Reference: The Wall Street Journal (Aug. 10, 2024) “Putting Pets in Your Will Is No Longer Just for Eccentric Billionaires”

How Should a Single Person Create an Estate Plan?

The short answer is singles should be doing the same things as people who are married and have families, except their situation may require some additional steps, says an article from Kiplinger, “Estate Planning for Singles.”

The most important thing is having a Durable Power of Attorney, naming someone as your agent so they can make financial decisions if you become incapacitated. Similarly, you should also appoint a Health Care Proxy to handle medical decisions.

If you don’t have a will, your state’s law will determine how your assets will be distributed, but no state will have a list of people to make financial or health care decisions for you.

Adult children often fill these roles, but it’s fine to look for other people to serve in these roles. A trusted friend whose judgment you trust completely and who is good at managing financial and legal matters could also serve in this role.

If the person you name to be your representative dies or becomes incapacitated, you’ll want to have a plan for someone else to take on the role.

Consider the age of the person you may want to serve in their role. If they are your age, can they take on these tasks if and when needed? A younger, trusted person may be a better choice, although there are no guarantees of age determining their availability.

If you don’t know anyone who could manage these roles, you could hire a professional, either an estate planning attorney, a trust company, or, in some states, someone licensed as a “professional fiduciary.”

What about your pets? An estate plan can also deal with issues of special concern to singles who own pets. You can use your will or create a pet trust to name a guardian and provide financial support for a furry or feathered friend.

Lastly, certain states have estate taxes, which have far lower exemptions than the current federal estate tax of more than $13 million. Some state estate taxes kick in on estates valued at $1 million. Married couples can delay estate taxes until the second spouse's death, but singles need to plan for tax liabilities, which is part of an estate plan.

Reference: Kiplinger (Feb. 17, 2024) “Estate Planning for Singles”

Should My Pet Be in My Will?

Most of us love our pets like family, yet chances are you haven’t made a plan for your pets if you become incapacitated or die before they do. This is mainly because it’s unpleasant to consider, according to a recent article from The Washington Post, “What would happen to your pets if you weren’t here?”

In generations past, pets lived in the barn or mostly outside. They ate table scraps and whatever they could catch. Pets now have their own beds, go on family vacation, and are often seen at restaurants, hotels and airports. Americans spent an estimated $143.6 billion this year on pet care.

Contemplating your own death is unpleasant, as is considering your death and distribution of all your assets. However, having a conversation about your pets can give you the peace of mind of knowing your beloved animal companions will be cared for after you have passed or if you cannot care for them.

The problem is, if no plans have been made for the pet, they could end up in a shelter and, worse, be euthanized. This particularly concerns older pets, who are far less likely to be adopted than younger animals.

The first step is deciding who you would want to care for your pets. Who would take your dog or cat? This changes over time, as people in their 40s might think their parents will take their pets. However, ten or twenty years later, their parents will probably not be able to take on caregiving.

Next, have a detailed conversation with the person or people you want to take care of your pets. Is their lifestyle and living situation pet-friendly, and would it suit your pet? Talk with them about your pet’s health history, daily routines, like, and dislikes.

You’ll need a budget for your pet’s care. Add up their basic monthly costs, like food, treats, flea and tick prevention medications, then add in vet check-ups and shots, licensing fees and boarding costs. Build in increasing veterinary expenses, which increase as pets age, just like people. The total will be vital to calculating how much money you’ll need to set aside for your pet’s future care.

Under the law, pets are considered property, so you can’t leave them assets in your will. However, you can establish a trust for your pet, an enforceable legal arrangement for them in the event of your death or incapacity. The pet trust is a stand-alone document. However, estate planning attorneys recommend including a clause about it in your last will and testament to ensure that the people involved know about it and that your estate will adequately fund it.

Wills can take months or years to wind through the probate process, leaving your pet in limbo during this time. A trust is effective as soon as a death certificate is ready.

Your estate planning attorney can help create a pet trust. Then, you’ll need two roles: a trustee to manage and distribute funds and a custodian to receive the funds and use them to house and care for your pet. One person could fill both roles, or you could name a person to handle each of the two roles.

Pet trusts are typically set up as inter vivos trusts, also known as revocable or living trusts. They become effective upon your death or if you become seriously ill or injured. Trusts are set up like any other trust, except the beneficiary is an animal. All fifty states recognize some form of a pet trust.

Because your pets’ needs and the people you’ve assigned as trustees and guardians may change over time, reviewing the pet trust regularly is a good idea. The same is true of your overall estate plan.

Reference: The Washington Post (Dec. 5, 2023) “What would happen to your pets if you weren’t here?”

Does a Will Protect My Money and My Family?

If you die without a valid will, your state may keep more of your assets than if you have a will. Your family won’t have any control and the court will follow the laws of your state regarding how your assets are distributed. That’s probably not what you want to happen, according to the article “People Are Dying Sooner So Protect Your Money Now” from Investor’s Business Daily.

Life expectancy in the United States is falling. Therefore, the need for an estate plan, including a will, is rising. In 2021, American life expectancy fell to 76.6 years, compared to 76.99 years in 2020 and down from 78.86 years in 2019. Despite this trend, fewer than half of Americans have a will.

An estate planning attorney can translate your wishes into your will and estate plan. Here are the basics that you need to know to protect your family and your money.

Beneficiary designations override a will. Whoever is listed as a beneficiary on an investment, retirement, or bank account will get your assets after you die. If you list someone different in your will, make sure that your beneficiary designation is the same. Don’t neglect pension or retirement accounts that were opened decades ago.

If you own property in more than one state, your estate plan needs to address multi-state ownership, federal and state taxes and plan for the likelihood of having to go through probate in each state.

A will is just the beginning of an estate plan. Estate planning involves more than death—you also need to plan for incapacity. A durable power of attorney allows someone of your choosing to legally manage finances, if you become incapacitated because of illness or an accident. A health care proxy empowers someone else to make medical choices, if you can’t communicate your wishes. A living will also puts your health care decisions in writing.

If you have a pet you want to have cared for after you have passed, you can do that with a pet trust. Pets are considered property and cannot inherit assets, but a pet trust is used to name a caretaker and a trustee.

The more information you can prepare in advance, the easier it will be for your family to handle your estate. Create an inventory of your accounts, including the name of the institution or company, account numbers and your usernames and passwords. Don’t include this information in your will, which becomes a public document once it’s filed in court. This list needs to include everything it takes to run your household (utilities and landscaper), medical care (physician, pharmacist, and any specialists), and finances (financial advisor, mortgage company and banking).

Make a list of key people, including your executor and backup executor. Create a list of people who you want to be notified, from heirs and family members to work and community groups.

The planning you do now will lessen the stress on your loved ones.

Reference: Investor’s Business Daily (May 2, 2022) “People Are Dying Sooner So Protect Your Money Now”

What Is the Purpose of a Pet Trust?

You don’t have to be a billionaire to want to protect your pets. However, you do need to plan for their well-being, if something happens to you. Since pets are considered property, they can’t inherit money to be used for their care. Instead, as explained in a recent article from Barron’s Penta “Future Returns: Why Fido Needs a Trust” titled owners can create pet trusts to protect them, if something happens to their humans. With close to 70% of American households having pets, pet trusts have now become mainstream.

Owners need to designate a reliable caregiver, just as they would designate a guardian for minor children. If you don’t have family members or friends who love animals, contact a local animal rescue group to learn if they have a life-long care program for animals. Many do, with programs incorporating Charitable Remainder Trusts to cover the cost of the pet’s care.

If you want a friend or relative to care for your pet, make sure they are willing and able to do so.  You should have another person as a back-up, in case something happens to them. Circumstances change, and someone who wants to take care of your pet now may not be able to in future years. How long you need to plan for depends upon the lifespan of your pet.

An experienced estate planning attorney can create a pet trust. Because state law enforces conditional distributions from the trust, the care of your pet can be enforced in court, if necessary. The pet owner names a beneficiary, the caregiver and funds the trust with enough assets to care for the pet.

The pet owner also names a trustee. They are a responsible person who will be in charge of distributing funds and making sure they are used for the pet’s well-being. The trustee also makes sure that the pet is healthy and being properly cared for, following the directions of the trust.

Your estate planning attorney will know what your state’s laws are regarding pet trusts, which varies from state to state. For instance, Pennsylvania requires a pet trust to end when the last pet in the trust dies, while other states may limit the trust’s length to 21 years. For dogs and cats, 21 years is a reasonable period of time. However, for other pets, like birds who can live to 100 years, this won’t be long enough.

You’ll need to fund the trust, making sure that there’s enough money to cover the pet’s needs throughout their lifetime. You may also consider the caregiver’s needs, depending on circumstances. How much is reasonable will depend upon the type of pet and the lifestyle of the caretaker. An apartment dweller caring for an elderly cat will need a different level of resources than a person tasked to care for a young horse.

Some states limit the amount of money in a pet trust and will penalize overfunding. Making sure your pet trust is appropriately funded may limit the likelihood of its being challenged.

Reference: Barron’s Penta (April 18, 2022) “Future Returns: Why Fido Needs a Trust”

What Happens to a Pet when Owner Dies?

Pet trusts are a legally binding arrangement in which the donor (the person creating the trust) formally outlines their wishes for how they want their pet to be cared for.

A few more people are involved in a pet trust, according to the article “’Paws-ing’ to plan: How you can ensure your pet’s future well-being with pet trust planning” from The Gilmer Mirror. A trustee oversees the way trust funds are dispensed, a caretaker, who is in charge of the pet’s care and an enforcer, who makes sure the donor’s wishes are followed. Donors may appoint a caretaker of their choice, or work with an agent to find someone suitable for their pet.

Unlike an informal promise to care for a pet made by a well-meaning friend or family member, the pet trust is legally enforceable, giving it more "teeth” than a verbal promise. There is nothing to stop the person you leave your pet with from doing whatever they wish with the pet, from leaving the pet at a shelter to selling the pet. With a trust, all parties are bound to use the money for its intended purposes and to follow pet care instructions.

What can you ask your pet’s caretaker to do? Anything you feel is necessary. It can be as basic or as detailed as you wish. The pet could be cared for as they were by you, with the same kind of food, attention and affection. They can also continue to be seen by the same veterinarian, if one is named in the trust.

Pet planning has become increasingly popular, as more people see their pets as members of the family. However, pet trusts are not just for house cats or dogs. Work animals, show animals, specially trained service and companion animals and animals used for breeding are also protected by pet trusts.

A pet trust could ensure the future of a highly trained show jumper, or to ensure a working dog ends up at a farm where she continues to herd sheep.

Pet trusts are especially important for people with service animals. A blind person who has bonded with a seeing-eye dog may only wish another blind person to inherit a seeing-eye dog. The trust could ensure that animals who have been trained to provide emotional support, or to detect health conditions like seizures, should go to individuals with these same challenges.

Individuals who live with highly trained service animals should consult an experienced estate planning attorney along with the organization that trained the animal to ensure a pet trust is created within the scope and requirements of the organization, as well as the wishes of the owner. The organization may be better able to place the animal, while adhering to the pet trust’s requirements.

A pet trust helps protect our beloved animal companions and provides peace of mind for their humans. It should be part of your overall estate plan and should be updated regularly.

Reference: The Gilmer Mirror (March 23, 2022) “’Paws-ing’ to plan: How you can ensure your pet’s future well-being with pet trust planning”

How Important Is an Estate Plan?

Estate planning is preparing for two things: incapacity and death. It includes making sure you’ve conveyed your wishes about medical care in the case of a serious or terminal illness, who you want to receive your possessions when you pass and a series of documents to tell your loved ones your wishes. A recent article from The Street, “Everyone Needs an Estate Plan,” explains how to make this happen.

The foundation of the estate plan is your will, aka Last Will and Testament. It’s used to name several individuals for key roles. One is a guardian for minor children—if you don’t have a will or fail to name a guardian, a court will decide who should raise your children. Another is the executor, the person who will be in charge of overseeing your estate and your instructions. If you have animal companions, you may name a person to be their caretaker. However, you may want to go a step further and create a pet trust to provide funds for their maintenance.

You’ll also want a Living Will. This is a document conveying your wishes, if you are no longer able to make healthcare decisions for yourself. It focuses on end of life care. Do you want to be kept alive with artificial means, and if so, which ones are acceptable? How would you want pain management to be handled? Do you want to donate your organs? Yes, it’s a little scary, but imagine your loved ones in a highly emotional state having to guess what you would have wanted. It’s better for you and your family to know what you would want.

A personalized Power of Attorney. Naming a person as a Power of Attorney lets them handle your financial affairs and act as your agent or representative. However, here’s a pitfall: using a standardized form can lead to trouble. You may want your POA to be able to manage your day-to-day finances, but there may be some things you’d prefer them not to do. A customized POA can be as broad or as narrow as you wish.

Healthcare Power of Attorney and HIPAA Authorization. Information and decision making about healthcare today is complicated today. Your representatives will need to have these documents to speak with your medical care providers, to make decisions and to gain access to your medical records. Without a HIPAA form, you won’t be able to see their medical records, even if you are a sibling or spouse. It’s best to have these documents in place long before they are needed.

The laws about these and other estate planning documents vary from state to state. Therefore, you’ll need to work with an experienced estate planning attorney in your area to make sure that all of your documents are valid. If you own a business or have a complex financial situation, there are many legal methods to protect your assets and convey them to your heirs.

Reference: The Street (Nov. 22, 2021) “Everyone Needs an Estate Plan”