Do any of your family members have feathers, fins or fur???
If yes, what arrangements have you made to take care of them should something happen to you?
You had not thought about that, had you?
You likely are not alone.
Some two-thirds of Americans have pets.
Most of these pet owners have a dog (70%), followed by a cat (50%), fish (11%), and birds (8%). Finally, still others have horses, rodents or reptiles (7% for this grouping).
Personally, I am partial to guinea pigs.
Our household was especially fond of a "gip" (i.e., "pig" spelled in reverse) who went by the terrifying nom de guerre "Spike" (see photo) and inhabited a special place in our home and hearts for a time.
Historically, estate plans could not be made to take care of your pets upon your passing.
Because pets were regarded as "property" and how could you leave "property" (your estate assets) as an inheritance for "property" (your pets)?
All of this began to change in 1990 with the amendment of the Uniform Probate Code to recognize "Pet Trusts" as a legal vehicle to provide for pets upon the incapacity or death of pet owners.
A recent article in The Naples Daily News, titled “Pet Trusts Gaining Popularity,” tells the tale of how the state of Florida enacted laws authorizing the establishment of pet trusts back in 2003 - and how Florida allows folks to provide for the lifetime care and maintenance of their pets.
Today, nearly every state permits such trusts with some variation.
Here are the basics:
Commonly, a named trustee is tasked with responsibility for the investment, management and distribution of the trust assets.
At the same time, another individual is appointed under the trust to avoid conflicts of interest as the pet’s caregiver.
In addition, the trust language itself provides details for caregivers, medical needs, and the even final arrangements upon the pet’s death.
From a tax perspective, if the trust is validly established under state law, then the assets passing to a pet trust are included in the decedent’s gross taxable estate.
However, no part of the assets qualify for a charitable deduction—even if the remainder beneficiary after the passing of the pet is a qualifying charity.
Planning for your pets can be an important part of your estate planning process.
If you are considering a Pet Trust as part of your estate plan, contact an experienced estate planning attorney.
Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.
For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri), visit our estate planning website and be sure to subscribe to our complimentary estate planning e-newsletter while you are there.
Reference: Naples Daily News (August 17, 2015) “Pet Trusts Gaining Popularity”