Remembering Fido: How Pet Trusts Work
About 68 percent of families in the United States own at least one pet. So many people consider their pets to be part of the family that the term “pet parents” is commonly used. It’s only natural then that people might worry who will care for their beloved dogs and cats when they no longer can. Since estate planning covers every other aspect of our lives, setting up a pet trust makes perfect sense.
What will happen to my pet if I become ill or pass away?
We are responsible for providing food, water, shelter, and companionship to our pets every day. If a pet owner becomes incapacitated or passes away, someone else must pick up those responsibilities. Talking with friends or family members about who will feed and water your pets in case of an emergency may help on a temporary basis, but more permanent arrangements should be made. A pet trust may provide a way to set up that type of long-term care.
How does a pet trust work?
A pet is considered property after your death – just like your 1965 Mustang or your collection of thimbles. Like your other property, the pet must pass to someone and you can’t leave money directly to the pet. In other words, you can’t name Whiskers as a beneficiary in your Will and leave him a sum of money.
You could leave money to a pet caregiver, but that’s not always the best solution. Simply leaving money to someone who has agreed to take care of your pets doesn’t mean that person will actually follow through. There’s nothing, other than common decency, to stop them from taking your pet to a shelter as soon as the estate is settled.
However, a pet trust offers benefits including:
- As pet owner, you state who will care for the pet, what type of care is desired, and how to pay for that care.
- Unlike a Will that goes into effect upon the death of the testator, the trust takes effect upon the pet owner’s disability or incapacity.
- The caregiver can quickly access trust funds needed for the pet’s care.
- Any money left in the trust after the pet’s death is distributed to beneficiaries according to the terms of the trust document.
Arizona law limits the amount that can be placed in the trust to the amount actually needed for the pet’s care. For example, a $20 million trust fund created for Fido, a 12-year old beagle, may be challenged by other beneficiaries since it’s unlikely the dog’s care will cost $20 million. Courts have been known to reduce excessive pet trusts to a reasonable level and distribute some of the money to other heirs.
Is There a Beloved Pet in Your Life?
Keystone Law firm’s staff of attorneys assist people with their legal questions every day. Check out our videos at keystonelawfirm.com or, to schedule an appointment, call us at (480) 209-6942. Serving Arizona communities like Ahwatukee, Sun Lakes, Tempe and more.