What is a Pet Trust?
A pet trust is a legally sanctioned arrangement providing for the care and maintenance of one or more companion animals in the event of a grantor’s disability or death. The “grantor” (also called a settlor or trustor in some states) is the person who creates the trust, which may take effect during a person’s lifetime or at death. Typically, a trustee will hold property (cash, for example) “in trust” for the benefit of the grantor’s pets. Payments to a designated caregiver(s) will be made on a regular basis. The trust, depending upon the state in which it is established, will continue for the life of the pet or 21 years, whichever occurs first. Some states allow a pet trust to continue for the life of the pet without regard to a maximum duration of 21 years. This is particularly advantageous for companion animals that have longer life expectancies than cats and dogs, such as horses and parrots.
Florida Pet Trusts
Pets are part of the family, and it’s only natural that you would want to protect them just like any other member of your family. Florida law specifically allows for the creation of a trust to provide for the care of one or more animals, though with some limitations:
The trust may benefit only animals who are alive during the grantor’s lifetime
The trust must terminate upon the death of the last surviving named animal
If a court determines that the trust assets are excessive in comparison to the intended use, the excess property will be returned to the grantor or his estate
Although most people think in terms of providing for a pet after they pass away, a pet trust may also be useful during the pet owner’s lifetime. For example, a pet trust might be used to provide for the care of an animal after his owner entered a long-term care facility, or while the owner was on active duty with the military.
Pet trusts were once thought of as something only for extremely wealthy or eccentric individuals, but today many ‘regular’ people use pet trusts to ensure that if they die before their pets, their pets will have a secure future.
Every state and the District of Columbia, except for Washington, now has laws governing the creation and use of pet trusts. Knowing how they work and what they can and cannot do will be helpful if you are considering having a pet trust made as part of your estate plan.
When you set up a trust, you are the “grantor.” You have the authority as creator of the trust to direct how you want the assets in the trust to be managed, for yourself and any beneficiaries of the trust. The same principal holds true for pet trusts. You set up the trust and name a trustee. The trustee oversees the money and any other assets placed in the trust for the pet’s benefit. Those funds are to be used to pay for the pet’s care and related expenses. These expenses can include:
Regular care by a veterinarian,
Emergency veterinarian care,
Feeding and boarding costs.
A pet trust can also be used to provide directions for end of life care and treatment for pets, as well as burial or cremation arrangements you may want for your pet.
In most instances, the pet trust, once established, remains in place for the entire life span of the pet. Some states, however, place a time limit on how long the trust can continue. For animals with very long lives, like certain birds or horses, you’ll want to be sure the trust will be created to last for the entire life span of your pet. In several states, the limit is 21 years.
An estate planning attorney who has experience with pet trusts will know the laws of your state, so you’ll be able to create a trust for your pet.
Creating a pet trust is like creating any other type of trust. An estate planning attorney can help with drafting the documents, helping you select a trustee, and if you’re worried about your pet outliving the first trustee, naming any successor trustees.
Here are some things to consider when setting up your pet’s trust:
What’s your pet’s current standard of living and care?
What kind of care do you expect the pet’s new caregiver to offer?
Who do you want to be the pet’s caregiver, and who should be the successor caregivers?
How often should the caregiver report on the pet’s status to the trustee?
How long you expect the pet to live?
How likely your pet is to develop a serious illness?
How much money do you think your pet’s caregiver will need to cover all pet-related expenses?
What should happen to the money, if any remains in the pet trust, after the pet passes away?
The last item is important if you don’t want any funds to disappear. You might want to have the money split up to your beneficiaries to your will, or you may want to have it donated to charity. The trust for your pet needs to include a contingency plan for these scenarios.
Another point: think about when you want the pet trust to go into effect. You may not expect to become incapacitated, but these things do happen. Your trust can be designed to become effective if you become incapacitated.
Make sure the trust clearly identifies your pet so no one can abuse its terms and access trust funds fraudulently. One way to do this is to have your pet microchipped and record the chip number in the documents. Also include photos of your pet and a physical description.
Be as specific as necessary when creating the document. If there are certain types of foods that you use, list them. If there are regular routines that your pet is comfortable with and that you’d like the caregiver to continue, then detail them. The more information you can provide, the more likely it will be that your pet will continue to live as they did when you were taking care of them.