For many pet owners, pets are members of the family. Pet owners often say that if something happens to them, they are as concerned about will happen to their pets as they are with their children and spouse.
What Happens to the Pets When the Owner Becomes Disabled or Passes Away?
Most pet owners want the assurance of what their pet will experience if they can’t provide for them. Without proper planning, state and county laws dictate what happens to the pet. In many states, a pet is taken to a shelter by Animal Control if a family member is not present and willing to care for the pet and in many cases pets may be euthanized within three to five days if a family member does not come to get your pet.
Thus, it is critically important that pet owners know how their state and county laws may impact their pets
Planning Tip: Pet owners should discuss with their estate planning attorney how state and county laws affect pets after the owner passes or cannot care for the pet.
Providing for Pets Upon the Owner’s Passing
Pets have many ongoing financial needs, such as the cost of daily care (food, treats, and daycare), veterinary care (yearly teeth cleaning, shots, nail trimming, and emergency care), grooming, boarding, travel expenses, and pet insurance. As a pet owner, you will want to ensure the pet guardian has the financial resources to adequately support and provide for your pet.
You can leave cash for a pet guardian in one of two ways: outright gift or pet trust.
Outright Gifts: The law considers pets “property”, and thus an individual cannot leave money outright to a pet, since property cannot own other property. Instead, you may leave an outright gift of cash to a pet guardian with the request that the pet guardian use the funds to care for the pet for the rest of the pet’s life. Note, though, that if the caretaker receives the cash gift outright and not in a pet trust, no one is responsible for ascertaining whether the pet is receiving the care requested by the pet owner.
Pet Trusts: To protect a cash gift for pets from being spent on anything other than the pet, you can utilize a pet trust instead. A pet owner names a pet guardian as the beneficiary of a pet trust, requires that the distributions to the beneficiary are dependent on the beneficiary caring appropriately for the pet, and requires the trustee to ensure that the beneficiary is properly caring for the pet using trust assets. A pet trust is helpful when the amount of cash left for the pet is significant, otherwise the cost for separately maintaining and administering a pet trust may not be worth the benefit.
If you opt for the pet trust, here are several things to take into consideration:
- Creating a pet panel to offer guidance to the trustee and pet guardian, and to remove and replace the trustee and pet guardian if necessary. Consider including a veterinarian to make the final decision regarding euthanization for medical reasons, to ensure that the pet is not euthanized prematurely by the pet guardian.
- Paying the pet guardian a monthly gift for caring for the pet.
- Awarding a bonus to the pet guardian at the end of the pet’s life as a “thank you” for taking care of the pet.
- Determining how the trustee is to distribute the remaining trust funds after the last pet dies.
Planning Tip: Will planning is inadequate for pets because a last will does not address disability and because of the time lapse between the pet owner’s death and the will being admitted to probate.
Do you have a pet? Is your pet protected by your estate plan? Contact us for comprehensive pet planning as part of your estate plan.