When my wife and I are out of town, we call my friend, Kristin Skelton, owner of Floofins and Co., which provides pet sitting and dog walking services, to make sure that our black lab, Leah, is taken care of while we are gone. Kristin recently told me that many of her clients had asked her about pet trusts, which are trust funds you can establish to ensure that your pets are taken care of after you pass away. Being a dog lover myself, I was thrilled to write an article on the subject at Kristin’s suggestion.
Pet trust law, including the validity of such trusts, varies from state to state. Fortunately, Illinois recently enacted a statute that explicitly provides for the creation of pet trusts.
When you create a pet trust, your attorney will draft a trust document naming your pet as the beneficiary of the trust after you pass away and also naming a trustee, who will be responsible at that time for managing the assets of the trust for the benefit of your pet. You and your attorney can then transfer assets into the trust.
Such assets will remain in your control during your lifetime, but will not be included in your estate at your death. Instead such assets will be legally held by the trust until they are distributed for the care of your pet according to the terms of the trust.
For more information on trusts in general, please visit our estate planning page, where you can watch a short video of our recent estate planning seminar.
If you are considering a pet trust, you should keep the following information in mind:
- Trustee: It is advisable for the trustee to be someone other than the caretaker of the pet. You should also name at least one successor trustee in case the original trustee should be unwilling or unable to perform his or her duties. The Illinois statute provides that no portion of the trust assets can be used for the trustee’s own purposes, unless specifically provided for in the trust document. Your trust document can provide for compensation to your pet’s caretaker or to the trustee, should you so choose.
- Beneficiary: You may identify each beneficiary pet by simply stating your pet’s name. However, you can also reference your pet’s microchip, if you have had one inserted. In addition, you may include any descendants of your pet as beneficiaries.
- Management: In the trust document, you may provide a detailed description of how your pet should be cared for, including naming specific veterinarians that are authorized to care for your pet.
- Termination: The trust will terminate when no beneficiary pet is living. The trust document should describe how you want the remaining trust assets to be distributed at this point. If the document does not contain such a description, the remaining assets will be distributed to your heirs, according to statute.
- Funding: The trust may be funded by transferring your assets to the trust during your lifetime. However, it may also be funded by a life insurance policy, of which the trust is the beneficiary. If the assets in the trust are substantially more than reasonably necessary to accomplish the trust’s purpose, the court has the power to reduce the amount of assets held by the trust.
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