CategoryEstate Planning for Pets

What Happens to My Pets If I Die?

For many of us, pets are members of the family. Some even say that if something happens to them, they are more concerned with what will happen to their pets than to their children or spouse. 

In this post, we’ll look at the issues surrounding caring for pets after the disability or death of the pet’s owner. Given the feelings of many individuals towards their pets, and the costs of care and longevity of some types of pets, planning in this area can be of critical importance. This is particularly true given our mobile society and that the laws of a different county or state may impact you and your pets or the pets of parents and other loved ones. 

What Will Happen to the Pets When the Owner Becomes Disabled or Passes Away?
Most pet owners do not want their pets killed if something should happen to them. However, without proper planning, the death of the pet is almost certain in some areas. For example, in some Nevada counties, if the owner does not provide for a pet by way of a trust, when the owner dies Animal Control must take the pet to the local kill shelter if there is not a family member present who is willing to care for the pet. Some kill shelters euthanize animals 72 hours after they arrive at the facility, making it virtually impossible for anyone to adopt the pet. It is critically important that pet owners know how their state and county laws may impact their pets. 

Planning Tip: Pet owners should discuss with their advisor team how state and county laws affect pets after the owner dies or cannot care for the pet.

Planning Tip: A good resource for pet owners is Providing for Your Pet’s Future Without You by the Humane Society of the United States (order a free kit by calling 202-452-1100 or e-mailing petsinwills@hsus.org). It includes a door/window sign for emergency workers, an emergency contacts sticker for inside of the door, emergency pet care instruction forms for neighbors/friends/family, wallet alert cards, and a detailed instruction sheet for caregivers.

Providing for Pets Upon the Owner’s Death

Outright Gifts
The law treats pets as property, and thus an individual cannot leave money outright to a pet, as property cannot own other property. An individual may leave an outright gift of money to a caretaker with the request that the caretaker care for the individual’s pet for the rest of the pet’s life. However, because the caretaker received the gift outright, and not in trust, no one is responsible for making sure the pet is receiving the care requested by the pet owner.

Once the caretaker receives the gift and the pet’s owner is gone or incompetent, there is nothing to stop the caretaker from having the pet euthanized, throwing it out on the street, taking it to a local kill shelter, or using the assets in ways unrelated to the care of the pet. Also, once in the caregiver’s hands, the assets are exposed to the caregiver’s creditors and they may be transferred to a former spouse on the caregiver’s divorce. 

Statutory Pet Trusts
The majority of states and the District of Columbia have enacted statutes pertaining to pet trusts, and Michigan is no exception (find out more by reading this previous blog post). These statutes allow virtually any third party designated by the terms of the trust to use the trust funds for the benefit of pets. 

Some state statutes specifically limit the terms of a pet trust. For example, some states limit the amount of money an individual can leave in trust for his or her pet to the amount required to care for the animal over the term of the trust. The trust must distribute any excess funds to the beneficiary(ies) who would have taken them had the pet trust terminated.

The pet’s current standard of care determines the endowment amount required to provide care for the pet. Factors include: the cost of daily care (food, treats, and daycare), veterinary care (yearly teeth cleaning, shots, nail trimming, and emergency care), grooming, boarding, travel expenses, and pet insurance. Additional factors may apply in particular cases. For example, horses are expensive to maintain and require exercise, training, and a large tract of land; some birds and reptiles have very long life expectancies; and care of some pets will require construction of a special habitat on the caregiver’s property. 

Traditional Trusts
Even in states that do not have a specific pet trust statute, a pet owner can name a human caregiver as the beneficiary of a trust, require that the distributions to the beneficiary are dependent on the beneficiary caring appropriately for the pet, and require the trustee to ensure that the beneficiary is properly caring for the pet using trust assets. This type of trust may be used without regard to whether the state has a specific pet trust statute.

Planning Tip: Both statutory pet trusts and traditional trusts allow the pet owner to provide detailed requirements as to how the caregiver must care for the pets upon the pet owner’s disability or death.

Planning Tip: Will planning is usually inadequate for pets because Wills do not address disability and because of the time lapse between the pet owner’s death and the Will being admitted to probate.

Funding Pet Care
Many pet owners do not have sufficient funds to properly care for their pets after their disability or death. Life insurance is one way to increase funds available to care for pets after the pet owner’s death.

Planning Tip: Pet owners should consider life insurance that names a pet trust or traditional trust as beneficiary to fund a pet’s care. If the pet owner is concerned that funding of a pet or traditional trust will reduce the inheritance of children or other beneficiaries, he or she should consider life insurance that names both (1) the pet or traditional trust and (2) other beneficiaries (or a trust for their benefit). These assets can be invested like any other assets during the owner’s lifetime, and those who currently manage the assets can continue to do so for the pet’s lifetime.

Trust Terms
Here are several issues for pet owners’ consideration:

  • Creating a pet panel to offer guidance to the trustee and caregiver/beneficiary, and to remove and replace the trustee and caregiver/beneficiary if necessary. Consider including a veterinarian to make the final decision regarding euthanization for medical reasons, to ensure that the pet is not euthanized prematurely by the caregiver/beneficiary.
  • Paying the caregiver/beneficiary a monthly fee for caring for the pet or allowing the caregiver/beneficiary to live in the pet owner’s home, rent free.
  • Awarding a bonus to the caregiver/beneficiary at the end of the pet’s life as a “thank you” for taking care of the pet.
  • Determining how the trustee is to distribute the remaining trust funds after the last pet dies.

If the pet owner decides against creation of a pet panel to determine who will be a successor caregiver/beneficiary, the trust should name multiple successor caregivers/beneficiaries (three or more) in case a caregiver/beneficiary is unwilling or unable to serve. As a final back-up, the pet owner should consider requiring the trustee to give the pet to a no-kill animal sanctuary if there are no caregivers/beneficiaries available.

An alternative to naming individual caregivers is for the pet owner to name a local charitable organization that will ensure care in exchange for a contribution upon the owner’s disability or death. A listing of such organizations nationally is available online by clicking here.

Pet Identification
To prevent the caregiver/beneficiary from replacing a pet that dies in order to continue receiving trust benefits, the pet owner should specify how the trustee can identify the pet. Micro-chipping the pet or having DNA samples preserved are two methods commonly used for verification. 

Other
Some pet owners want their healthy pets euthanized when they pass away because “no one can care for my pets as well as I do.” However, many courts have invalidated euthanasia provisions on the basis that destruction of estate property is against public policy. Instead, pet owners should consider no-kill organizations that have the pet’s best interest in mind and will find the next best home for the pets.

Conclusion

Many individuals are unaware of the issues surrounding the care of their pets after their disability or death. By discussing these issues with a Michigan Pet Trust Lawyer, pet owners can ensure that all of their loved ones are cared for, even when the owner is unable to care for them directly.

Michael Lichterman is an estate planning and charitable planning attorney who helps families and business owners create a lasting legacy by planning for their Whole Family Wealth™.  This goes beyond merely planning for “stuff” – it’s about who your are and what’s important to you.  He focuses on estate, charitable, and asset protection planning for all generations (“young” and “experienced”), the “sandwich generation” (caring for parents and children), doctors/physicians, nurses, lawyers, dentists, professionals with minor children, family owned businesses, and pet planning.  He enjoys creating life long relationships with his clients centered on their families values, insights, stories and experiences.

Don’t Forget Your Pets When Estate Planning

You may have read the post I wrote about Michigan Pet Trusts.  If not, you can read it by clicking here. If you care about your pets, it is a must read.  Almost every pet owner I meet truly cares for their pets.  Yet very few (and I mean VERY few) have any planning in place to ensure that their beloved “child with a fur coat” will be cared for if something happens to them.  The alternative is not pretty – suffice it to say that what happens to a lot of animals whose caregivers didn’t plan is…well, less than ideal.  The statistics are staggering.

A good friend of mine recently directed me to this USA Today article about estate planning for pets.  Overall I think the article is good . . . if for no other reason than it raises awareness of the need for estate planning for pets.  I will not “rehash” the entire article here, so make sure to read it for yourself.  I will, however, provide my thoughts on some of points in the article:

  • Some may scoff at the Leona Helmsley story – how much she gave to care for her dog and to animal humane groups.  Keep in mind that each of our situations is unique . . . we each have different things that are important to us in differing ways.  From the stories I read, Ms. Helmsley’s children may have left something to be desired.  It could be that her dog, Trouble, provided her the companion and love she needed . . . even moreso than family.
  • Always keep in mind the source of information (even the author you’re reading right now!).  Ms. Hirschfeld’s Pet Protection Agreement provided by Legal Zoom is mentioned several times in the article.  I have no doubt that she knows what she is talking about . . . just keep in mind that it’s more than likely that she receives a “cut” from the  sale of Pet Protection Agreements.  Interestingly, I looked at the Legal Zoom page for the agreement and noted a quote by the President of The Humane Society of the United States regarding peace of mind from having the Pet Protection Agreement.  Much like estate planning for your human family, I believe much of the “peace of mind” provided by online solutions is a false peace of mind.  Why?  Because you don’t know what you don’t know.  I’m the same way.  Why do I not perform my own surgery?  Fix my own roof?  Install my own furnace?  Because I don’t know how and even with a lot of study there are still things I won’t know because they only come from experience.  Plan how you feel best, but my suggestion for true peace of mind is to work with an attorney who focuses on pet planning.  And yes, I realize that you should consider the source when reading that last statement too 🙂
  • The author points out that Ms. Helmsley likely could afford “pretty decent lawyers.”  That doesn’t mean, however, that those lawyers had any experience with estate planning for pets.  Keep that in mind when planning for your own pets.  If you have to ask about how to plan for your pets rather than having the lawyer include it in their questionnaire or bring it up in a meeting, that should be a sign to you.
  • I see a multi-pronged approach as the most likely to ensure your pets are cared for by who and in the way you want: a pet trust, pet information sheet, pet care instructions and having conversations regarding care with those you would choose to care for your pet while you can have the conversation.
  • Much like planning for your human family, estate planning for pets is a process, not a transaction.  Your life will change, your pets may change, the lives of the chosen caregivers will change and the laws will change.  If your planning doesn’t change with it, it may not work the way you wanted when it is needed most.

What do you think?  I always enjoy hearing from my blog readers.  And don’t forget to call us today at 616-827-7596 to help make sure your pets won’t be “left out in the cold” (or worse!) if something happens to you.

Michael Lichterman is an estate planning attorney who helps families and business owners create a lasting legacy by planning for their Whole Family Wealth™.  This goes beyond merely planning for finances – it’s about who your are and what’s important to you.  He focuses on planning for  the “experienced” generation, the “sandwich generation” (caring for parents and children), doctors/physicians, nurses, lawyers, dentists, professionals with minor children, family owned business succession and pet planning – and he is privileged to do so from a Christian perspective.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.