Pet Trusts - Planning for Your Pet Long Term
The limits of what we do for our pets know no bounds. We seek to please them almost as much as they seek to please us. But, for all that we do, there is one area that most of us do not stop to consider. What happens to them if weÂ’re not here to care for them or speak on their behalf? Many of us dismiss the thought as negative or morbid. Many others choose to deny the possibility altogether. We think weÂ’re young and healthy and have plenty of time to take care of these things later. Unfortunately, the truth is that none of us is promised tomorrow. After events such as September 11, 2001 or more recently, Hurricanes Katrina and Rita, planning for a more negative scenario is critical. One way we can accomplish this is by creating a pet trust.
A pet trust is a legally sanctioned arrangement that provides for the care and maintenance of one or more pets in the event of their ownerÂ’s disability or death. To be legally enforceable, these should be prepared by a licensed attorney and tailored to meet the laws of your state. An attorney will also take into consideration your other needs with regards to property, children, etc.
Prior to 1990, courts refused to treat pets in estate documents as anything other than “honorary”. Basically, this meant that your wishes could be brushed aside if you did not have sympathetic judges, attorneys and/or family members. The Uniform Probate Code was revised to assist pet owners leave funds for the care of their pets after their own death.
Currently there are two types of trusts in existence: Testamentary and Inter Vivos. The difference is that a Testamentary Trust becomes enforceable upon the death of the owner and the Inter Vivos or Living Trust can be used in the event that the owner cannot take care of the animal. The fact that the inter vivos trust is immediate is a great benefit in itself. Some very important issues come into play such as, the identity of the pet, the amount of funding for the trust and the length of the trust.
When establishing your trust, primary objectives include finding trustworthy participants and creating a system of checks and balances. Unfortunately, we do not always know people as well as we think. Money can have a strange and toxic effect on people, even the ones we genuinely believe are immune. You will appoint a trustee to administer the estate. In regards to the pets, they will be responsible performing periodic checks on the pets. Most estate planners encourage you to name at least one alternative caregiver in case your first choice is not willing or able to care for your pets. You will want to have serious discussions with those you choose and give them copies of the documents once they are completed. Review these plans regularly since peopleÂ’s lives and situations are always subject to change.
Once you have chosen the people who will carry out your trust, establish a permanent method of identifying your pet(s). This may be through tattoos, DNA testing or other means. Be specific in requiring the trustee to conduct regular visits to the pet(s) in time periods stipulated by the trust. This helps to ensure the safety and welfare of the pet but also prevents pets being “impersonated” so that the trust is funded. To pet lovers, the very thought is revolting to the say the least. Unfortunately, there are numerous accounts of unscrupulous caretakers substituting one pet for another upon the actual pets death. After investigation, it is discovered that a pet trust was funded for years after the death of the beloved companion due to the greed of a caretaker. The problem of identification is one reason courts have shied away from dealing with pet issues in the past. In the long run, as many people looking out for a pet’s welfare, the better.
Next, determine the amount of money necessary to fund the trust annually. A few items to consider are costs for: food, treats, toys, kennels and/or bedding, monthly preventatives such as heartworm and flea, other medications, annual vaccinations, sick care, grooming and boarding. There could be others depending on your situation. Also keep in mind that this may need to be multiplied if you have several pets in your household. You will also need to determine if you will be paying your trustee and caretaker for their services. The funds can come from a variety of sources. An estate planning professional can assist you with these decisions. The cost can seem daunting, but donÂ’t let this deter you. Many people have simple agreements with friends and family which can work (but may not be enforceable in court). Again, the worst thing to do for your pets is nothing.
After all of this has been established, settle on the duration of your trust. This is the other major reason that courts have not wanted to be involved with animal trusts. The “rule of perpetuity” makes a trust invalid unless it is for a specific term. The trust cannot be perpetual, or limitless, in length. The law determines this period to be twenty-one years after the death of the last person affected by it. This comes into play primarily with people who own birds, horses or other pets with long life spans. Some states have adopted the Uniform Trust Act which provides for the trust to remain in effect for the lifetime of the pet. If you have a long lived pet and do not live in one of these states, contact an estate planning attorney to ensure they are properly cared for.
Several states have now enacted statutes that deal specifically with pet trusts (see http://estateplanningforpets.org/legal-statutes.htm for a complete list). If your state does not currently have provisions for your pet, you may still provide for them under Federal Law. There are several options, but doing nothing should not be one of them. No one knows your pet like you do.
Clearly, trust documents get complicated very quickly. While most wills are relatively short, it is not uncommon for a trust to be twenty to thirty pages long. Seek the advice of a knowledgeable attorney should you choose to go this route. Legal professionals have begun to realize the important positions that our pets hold in our homes and hearts. Previously, there was little protection under the law for pets. Both case law and statutes consider pets property and they were often dealt with in the same manner as a chest of drawers. It is vitally important that you contact an attorney who is familiar with estate planning for you state. They should be able to advise you as to whether your state has enacted a specific trust for pets or if your trust will be overseen by federal law.
Many experts advise clients to prepare a trust instead of a will. There are benefits and drawbacks of each. There is much information available through books, internet sites and experts. Be sure to learn just how including your pets in a trust will benefit you and them.
protection peace of mind
Be sure to include your Best Friends...
in your long term family planning.