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Estate Planning for Your Pet

2011 March 10
by Asset Protection Solutions

Everyone knows how important a properly executed estate plan can be. It can protect your assets, avoid a costly out-of-state probate proceeding, minimize estate tax liability and provide health care directives should you become incapacitated. But one area of the estate plan that many pet owners neglect to consider is what happens to your pets when you are no longer around.

For many people, their pets are like their children. They pamper them, care for them and they love them unconditionally. So today, there is a growing trend among estate planning attorneys to create what is commonly referred to as a “Pet Trust.” Essentially, a Pet Trust is a legal document that gives a pet owner  the ability to set aside funds for their pet’s future care after they’re gone, or during a period of incapacity. The Pet Trust is revocable and can be modified by the Grantor at any time before death. It is created much the same way that a special needs or support trust is created. The grantor (the person creating the trust) transfers a part of his or her estate to a trustee (generally the pet’s caregiver) to hold and distribute to the beneficiary of the trust, which is the pet.

But not only can a Pet Trust provide money for the care of your pet after your death, it can perform a number of other tasks essential to preserving the quality of life of your pet.

  • A Pet Trust can include a clause which stipulates your pet’s veterinarian, outlines the type of care your pet is to receive and most importantly, who specifically will serve as caretaker of your pet.
  • A Pet Trust can also stipulate your pet’s diet and exercise schedule, as well as provide directives to the trustee as to how your pet’s remains are to be disposed of.
  • In order to create a system of checks and balances, a Pet Trust can appoint a separate caretaker and trustee. The caretaker of your pet will have to ask the trustee for funds from the Pet Trust to be used in the care of your pet.
  • If planning for your pet’s future is limited to a clause in your will directing how your pet will be cared for, your estate plan is only half complete. In the event that you become incapacitated or disabled prior to death, that clause in your will has no effect. In that scenario, the Pet Trust kicks in to direct how your pet will be cared for during your time of incapacity or disability.

Why not just make an outright gift to the individual that I have appointed as caregiver for my pet?

Creating a Pet Trust ensures that your pet will continue to live the same quality of life after your death because the money set aside for their care is protected. The funds transferred into the Pet Trust are not subject to the caregiver’s creditors, marital disputes or an impending bankruptcy. Further, if the funds are gifted to the caregiver, when that caregiver dies, those funds go to the caregiver’s heirs, not to your pet.

Is a Pet Trust a valid type of trust in Washington?

Now some skeptics may be leery of creating such a trust, for fear that the courts might view this type of trust as a simple tax shelter or means avoiding estate taxes. But in Washington courts, this type of trust has been upheld time and time again. The Washington legislature even adopted the Animal Trust provisions in RCW 11.118 in 2001, allowing an animal to be the beneficiary of a trust.

Doesn’t a Pet Trust seem unnecessary?

Some skeptics might also feel that this type of document is unnecessary and that their personal representative will undoubtedly take care of their pet when they are gone. But according to animal welfare organization “2nd Chance 4 Pets,” over 500,000 pets are abandoned each year due to the death or disability of their owners. With proper planning, this type of outcome can be avoided. A simple Pet Trust can be created to ensure that your pet is properly taken care after you are gone.

You bend over backwards for your pet when you’re alive, why not do all you can to look after them when you’re gone. If you have a pet that you care deeply about, and your estate plan does not include a Pet Trust, it’s time to contact our office today so that we can take the proper steps to plan for your pet’s future.

Jared Bellum is a contributing author to this blog and has been admitted to practice law in the state of Washington.  He practices in the fields of bankruptcy, business start-ups, and estate planning.  JD Bellum, Attorney at Law, PLLC works in association with the Law Offices of Richard D. Seward, PC.

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