During every estate planning consultation, my clients often have some reaction regarding the issue of their pets. Some laugh, stare quizzically, and yet others seem completely natural with the idea. Regardless of the reaction, most people are surprised to learn that pet trusts actually exist.
Some people remember the late Leona Helmsley, a flamboyant businesswoman who had a reputation for tyrannical behavior that earned her the title Queen of Mean. However, she is also remembered for having a will that left a $12 million trust fund for her Maltese dog, Trouble. While that is extreme, we all know the strong bond between pet and owner – such that many people refer to a pet as their child.
While legally pets are considered property, to their owners, pets may be best friends and family — and in some cases, a pet may be a person’s only friend or family member. Therefore, when a person considers his or her estate planning, the care of pets should be addressed. A pet trust is a good tool to achieve this objective.
Section 5804.08 of the Ohio Revised Code authorizes the creation of trusts to provide for the care of animals. This is an important provision because historically, pet trusts failed for a number of reasons, one of which was that such trusts often did not have a person or beneficiary with standing to enforce the trust’s terms.
A properly structured pet trust provides a number of benefits:
- Can provide for the care of an animal in the event of the owner’s incapacity or death;
- Can provide protection for pets alive during the owner’s lifetime, regardless of whether the pets are alive at the time of the trust’s creation;
- Can provide for the appointment of a person to enforce the terms of the trust; and
- Can alleviate or mitigate problems involved with an owner’s estate.
Even if there are no major problems with an owner’s estate, a separate or stand-alone pet trust can provide seamless care for pets in the event of the owner’s death. The point here is that there is usually a period of time after someone’s death before a will is located and submitted for probate. This time gap leaves open the issue of who owns and cares for the pet during this period.
Here are some important elements to consider in designing any pet trust:
Custodian / Guardian – Consider naming one or more persons or entities in successive order to care for the pet.
Funding – While providing funds is optional, it is typically recommended. The question then follows is how much funding is necessary or reasonable. Factors to consider are how many pets are to be included, the types of pets, their ages, and the standard of living they are accustomed to.
While a pet trust may not be a part of everyone’s estate plan, a pet trust is certainly worth considering for those who want to provide for the care and well-being of their animals.