A pet trust is an arrangement allowing a pet owner to provide financially for the care of an animal in the event of the owner’s death or disability. In a nation that spends over $70 billion annually on pets, these trusts allow owners to plan for the financial reality of passing a pet to a friend or family member who may not otherwise have the resources to provide for its care. The associated costs– particularly where the caretakers are busy professionals – can be significant when one considers the costs of dog-walkers, veterinarians, pet insurance, boarding expenses, and so forth in addition to traditional maintenance expenses. A financial plan for a pet is essential.
The Massachusetts pet trust statute allows an owner to create a special purpose trust for one or more pets to last for the duration of the pets’ lives. The owner designates a person or organization as the Trustee, who this is often the same person entrusted with the physical custody of the pet, but need not be. The Trustee is provided with a certain amount of money and instructions for the benefit and care of the pet. The Trustee must comply with these instructions and cannot use trust funds for any reason not authorized by the pet trust. The law allows the owner to build in safeguards by appointing other individuals to monitor the Trustee’s activities and to enforce the terms of the trust on behalf of the pet if necessary.
However, unlike a typical trust, a pet trust may be second-guessed by the Court. Specifically, a Court can reduce the amount of money in the trust if the Court decides the amount “exceeds the amount required for the intended use” and finds there will be no “adverse impact in the care, maintenance, health or appearance of” the pet. In other words, don’t get carried away. One need only to recall the public furor surrounding Leona Helmsley’s $12 million trust for her Maltese, Trouble, to understand the purpose behind the limitation.
Are you thinking about planning for your four-legged companion or revising your estate plan to include a pet trust? We are always available to answer your questions.
