A good estate plan should provide for all of your dependents, including your pets. Gina M. Barry, Esq. of Bacon Wilson, P.C., is an attorney who specializes in estate planning for pets. She graciously agreed to explain to TH readers what they should know about the law regarding this area:

What options are available to a pet owner to be sure the pet is cared for in the event of the owner’s death?

“When an animal’s owner passes away, the animal will pass through the decedent’s estate as personal property, just as would a lamp, a couch, or a bedroom set. As such, the ongoing ownership of the animal should be addressed in the animal owner’s Last Will and Testament.

“When planning for the ongoing care of an animal, the typical documents established are a Will and/or a Trust. The Will must leave the ownership of the animal to the proper party. The Will may also leave a lump sum to be distributed along with the ownership of the animal. In that case, the ongoing care of the animal is not monitored, and the management of the lump sum left for care is also not overseen. It is also possible to create a trust within a Will to address all issues of ongoing animal care. Finally, it also possible to establish a trust that stands on its own.”

What is a pet trust, and what provisions can be included in it?

“A pet trust is similar to a trust that benefits a person with the only difference being that the beneficiary is an animal instead of a human being.  The reason some states do not recognize pet trusts is because their law does not allow an animal to be a beneficiary of a trust. A pet trust holds assets for the benefit of an animal, and the assets are distributed for the animal’s ongoing care in accordance with instructions that are provided within the trust document. The assets are managed by a Trustee who is charged with carrying out the instructions in the trust. In states where a pet trust is not allowed, a trust will generally be established for the benefit of the caregiver. The distributions to the caregiver will be conditioned upon providing proper care for the animal.

“One of the most important features of a pet estate plan is the naming of the pet’s caretaker. Generally, it is recommended that the caretaker not be the trustee of the trust. It is also important to name at least one alternate caretaker, if not several, who would provide care if the originally named caretaker was unable to do so. The most commonly named caretakers are relatives, friends, the pet’s veterinarian, the pet’s actual breeder or a breeder of the animal’s breed generally, or an animal shelter or sanctuary. A number of animal sanctuaries have emerged that will provide care for an animal until its demise. These facilities vary greatly in terms of the environment they provide, the cost of placing an animal within the sanctuary and the type of compensation that they will accept.

“Another important aspect of the plan is setting forth the terms upon which the caretaker will be paid. The caretaker may receive funds only to cover all verified expenses associated with caring for the animal.  Normal and customary expenses would include housing, food, veterinary care, grooming, and burial and cremation fees. Another alternative is to provide a lump sum to the caretaker based on the care to be provided until the pet’s demise. A lump sum distribution scheme may encourage the caretaker to skimp on the pet’s needs in order to allow the caretaker to retain the distribution personally. It is also important to give the trustee the power to oversee the care of the animal. Finally, it is beneficial to include strict guidelines concerning euthanasia and final disposition of the animal after it has passed away.”

Are pet trusts legal in all 50 states?

“Approximately one-half of the United States, including New York, New Jersey and California, do recognize trusts that benefit solely an animal. That being said, approximately one-half of the United States does not recognize such trusts. Fortunately, there are still options for an animal owner to consider if they reside in a state that does not recognize pet trusts specifically.”

What estate planning documents can be used in lieu of a trust to provide for your pet? What provisions do they contain?

“A comprehensive pet estate plan will also provide for the ongoing care of the animal should the owner lose the capacity to handle his own affairs, whether due to physical or mental illness. The Health Care Proxy, which [is] a document naming someone to make health care decisions for the owner, and the Durable Power of Attorney, which is a document naming someone to make financial decisions for the owner, should contain special provisions acknowledging the animal and providing for the animal’s ongoing care.

“Most often, a Durable Power of Attorney will authorize the person named to handle a laundry list of financial transactions. When an animal owner is incapacitated, the animal must be placed with a custodian and money must be spent to provide ongoing care. To avoid any controversy regarding the care and custody of the animal, the Power of Attorney should authorize the person named to take custody and control of the animal. The document should further authorize the person named to arrange for someone to provide care for the animal, even to the extent that said care would require additional monetary compensation to the caretaker.

“The Health Care Proxy should notify the person named and/or medical personnel that the incapacitated person is an animal owner and that the animal is dependent upon that owner for care. While medical personnel will certainly first attend to the owner’s care, if the owner remains incapacitated, the language of the Health Care Proxy will remind the person named, and should alert medical personnel, of the need to ensure the ongoing care of the animal.

“Note well that these documents only protect an animal whose owner is incapacitated. Once the owner has passed away, the powers given in these documents ends, and the Will and/or trust will then control the disposition and care of the animal.”

Chances are, you’ll probably outlive your pets. However, it’s a prudent idea to provide for them in the event of your death. After all, none of us knows what the future holds, and establishing an estate plan for your pets may turn out to be one of the smartest moves you ever made.