- To Fido, I bequeath: A Look at Pet Trusts
- November 17, 2014 | Author: William P. Ellsworth
- Law Firm: Chuhak & Tecson, P.C. - Chicago Office
Every estate plan should help the client dispose of property for the benefit of the client’s loved ones in a way that makes individual sense and eases administration costs and delay. While watching my 16 month old son chase a battery powered, goading, robotic kitty around the rooms of my home, I neutralized the racket by considering the recent laws passed for disposition of pets. 68 percent of U.S. homes now have pets. What considerations should be made during the estate planning process to transfer these special properties?
The common law considered a pet to be a person’s property. Since property cannot enforce its own rights, a gift of cash to a pet, either through a trust or directly, used to be deemed invalid. Instead, a person’s estate plan would have to provide for a transfer of a pet to a designated caretaker and gift funds directly to the caretaker with the intention that those funds be utilized for the pet’s benefit. Whether the caretaker actually applied the funds for the pet could not be monitored because the pet became the caretaker’s property. This transfer method created a succession problem for the pet if something later happened to the nominated caretaker. It also separated the pet from the funds to be used for the pet’s benefit.
In response to these problems, most states, including Illinois, now have ‘pet trust’ statutes. These laws solve the separation problem by allowing one entity to own both the pet and the trust funds explicitly for the pet’s benefit. In this manner, the trustee has both the oversight and authority to ensure the designated caretaker is properly caring for the pet and the oversight and authority to ensure the trust funds are applied for the pet in accordance with the owner’s wishes. If you are considering a pet trust, you should think about directions for the pet’s health, diet and care. Your instructions should be specific, but leave room for altered circumstances. You should estimate the costs associated with maintaining your pet in its accustomed manner and fund the trust with a reasonable amount to provide for your pet. Even with pet statutes, a court will not permit a decedent’s plan to leave excessive amounts for a pet to the detriment of the decedent’s human family. A good pet plan will allow your pet to continue its happy existence even if you don’t.
Pets have become increasingly important in our lives. Make sure that you’ve thought about a plan to ensure compassion and care of your pets.