Concerned About Fido’s Care: Consider a Pet Trust
Pets are often considered family members, yet many owners don’t plan for their future in the event of death or incapacitation. What happens to these well-loved and orphaned animals if there’s no one to care for them? Some will enter animal shelters and be euthanized.
When people plan for the future distribution of their assets, it’s essential they don’t forget about their pets. Making provisions for them doesn’t have to be complicated. It could be as simple as talking it over with your children or other relatives and ensuring that they would welcome your pets into their homes. But if you don’t know for sure where your dog, cat or other pet will end up, don’t leave the future to chance. For your peace of mind and the health and comfort of your furry friends, you need to do some planning.
What Are Your Options?
Ask your attorney what is allowed in your state. Most states have laws addressing pet trusts. Growing in popularity, pet trusts are similar to trusts that people set up to care for family members.
A pet trust provides a specified amount of money to be held in trust for the ongoing care of one or more pets. It generally terminates upon the death of the last surviving animal covered by the trust.
Here are some elements to consider in a pet trust:
- Trustee – You need to designate a person who will be the willing trustee. Ideally, it should be someone who likes animals. It’s a good idea to also appoint an alternate trustee in case your first choice cannot fulfill the obligation or doesn’t want to.
- Caregiver – Decide who will be the actual caregiver (as well as successor if necessary). The caregiver can also be the trustee, but doesn’t have to be.
- Funding – Determine how much money will go into the pet trust. The deciding factors should include the type of animal, the age, health, life expectancy, future food costs, potential future health needs, and the standard of living you wish the pet to have.
- Standard of living – You can specify nutritional needs, which veterinarian to use and other preferences.
- Distributions – What circumstances should trigger distributions for your pet’s needs? Besides reasonable care, you may specify regular six-month check-ups, monthly grooming or the services of an additional dog walker.
- Remainder beneficiary – Finally, you need to designate the person(s) or charity to receive the amount that remains in the trust after your pet dies.
The Court Factor
Courts have some discretion concerning how pet trusts are administered. Some states impose funding limits. As illustrated by Leona Helmsley’s estate (see right-hand box), a large amount of money left to an animal may be ruled excessive and put back into an estate.
In addition, there are a handful of states where pet trusts are not valid. Therefore, pet trusts or alternative arrangements must be carefully planned and comply with the laws in your state in order to be upheld.
FAMOUS DOG INHERITS FORTUNE
One of the most famous canine beneficiaries of all time was a Maltese named Trouble. Hotel heiress Leona Helmsley left the dog a $12 million trust fund when she died in 2007.
However, a surrogate court judge dramatically reduced the amount of the inheritance because it was ruled unreasonable. The judge ruled that $2 million was enough for Trouble to receive “the highest standard of care.”
The dog lived out the rest of its life at a Florida Helmsley hotel with a caretaker and a security guard.
When Trouble died in 2010, the remainder of the trust set up for her care reverted to a charitable trust Helmsley set up.
1745 South Naperville Road, Suite 100
Wheaton, IL 60189