Pets are companions that people from all over the world enjoy. Dogs and cats, in particular, are often left money in a trust fund by their wealthy owners that want to protect their pets in the event of their own demise.
A lawsuit in New York provides a prime example of how much money is left to pets from wealthy owners.
Owners put money in a trust fund for their pets, and it’s up to the executor of the estate to ensure that the trust fund’s money is used for the animal. Winnie Pooh, a seven-year-old dachshund, was given $100,000 in a trust from her Manhattan owner Patricia Bowers.
The trust was first setup when the dog was just one-year-old.
A lawsuit is being filed by the dog’s caregiver against the woman’s estate because the executor of the estate failed to provide the money to the pup for various veterinary procedures. The caregiver even paid for an orthopedic surgery out-of-pocket that was needed in an emergency situation.
Despite the executor’s failure to provide the funds for the dog’s healthcare, it does prove a point that money can be left for the care of an animal. Even ordinary, non-rich people can form a trust to leave money for their pet’s medical expenses.
Leona Helmsley had the most famous case of a trust fund for pets when she left her dog $12 million. A judge eventually declared that the trust amount was a little too high, and $10 million of the trust went to charity as a result.
Pets Are Deemed Property in the United States
People don’t leave money directly to their pets because they can’t do so in the United States. A pet is deemed property in the United States, so you can’t leave your animals money directly. But you can open up a trust on your pet’s behalf.
A trustee will manage the fund, and a caregiver will be the beneficiary.
The trustee will make sure that the pet is taken care of with the funds left in the trust.
And since a pet is property, they’re overlooked when you die in most cases. The pet will pass through intestacy. In a lot of cases, the pet will end up in an animal shelter, and may or may not be adopted before euthanasia.
Leaving Money to Your Pet in a Will
A lot of people who consult with a professional estate planner assume that they can just put everything in a will. But when you leave money to your pet in a will, the pet doesn’t have a voice and can’t take possession of the money.
It’s hard to legally enforce money left to your pet in a will, but in a trust, you can ensure a specific amount of money is utilized on your pet’s behalf.
When you have a pet trust, you have the ability to tell the trustee what the money can and cannot be used for in regards to caring for the pet. The caregiver may say that a new Mercedes is necessary for the transport of the pet, but you can override this even after your demise by stating money can only be used for food, grooming, shelter and vet visits.
If you leave money to your pet in a will, you lose a lot of the control you gain with a pet trust.
A traditional pet trust would work as a legally-enforceable obligation that would:
- Include trustee inspections of the pet
- Provide reimbursement for pet expenses
- Declare a caregiver
Alternative caregivers should also be mentioned in a trust. Someone, unfortunately, may not want to care for Fido.
The amount of money you leave for the care of your pet will depend on your finances. If you’re wealthy and expect your dog to live for 15 years, you may want a trust worth $15,000 – $20,000 because vet expenses and food can quickly add up.
Leaving money to a parrot can be even more costly because parrots can live for up to 100 years.
If you’re truly concerned for a pet, you can leave a large amount of money for your furry companion that generates income and will be able to care for your pet over the long-term.
Winnie Pooh, the dachshund mentioned earlier, may need back surgery due to the breed’s risk of degenerating discs in the back. Surgery can cost $8,000+, so this may also be something that needs to be accounted for in the trust because pet surgery and care can be very costly.
Unreasonably large trusts, such as the $12 million mentioned above, may fall within the “unreasonably large” category for a pet trust. This is a rare case, and the definition of “unreasonably large” is really not clear. But if a trust falls into this category, it’s possible that the trust’s money may be lowered by the court, with a majority of the reduced amount going to charity in most cases.
The Micklin Law Group, LLC is a New Jersey law firm specializing in family law and estates. Attorney Brad Micklin was recently named to The National Advocates list of Top 100 attorneys from each state. Brad has a special expertise in working in estate planning. You can read more on this topic by visiting our divorce blog. To set up a consultation, call 973-562-0100.