Hotel heiress Leona Helmsley did it, and so can you - provide for your pets after you're gone. Forty-two states and the District of Columbia now have laws that specifically authorize the creation of trusts for the care of pets. That's up from 16 states in 2003, with Connecticut, Maryland and Vermont enacting their pet trust laws just last year.
In fact, with a little common sense, you can do it better than Leona, who famously cut out her two grandchildren from her $5 billion estate while leaving an over-the-top $12 million to a trust to benefit her Maltese, Trouble. Not surprisingly, after Helmsley's death in 2007, the two disinherited grandkids sued, challenging whether she'd been mentally competent when she
In Pictures: 10 Ways To Protect Your Pet
Man's Best Spend
Estate Mistakes: Where Heath Ledger And Princess Di Went Wrong
made the will. The case settled, with Trouble getting $2 million and the two grandkids sharing $6 million plus legal fees.
In some pet trust states you can create a trust at your death with a simple instruction in your will, such as: "I leave $1,000 in trust for the care of my dog, Fido," or "I leave $5,000 in trust for the care of all animals I own at the time of my death."
But Beyer recommends including more details, such as naming a trustee (and alternates), stating how the money should be doled out and specifying what should be done with any leftover cash. Be sure to name both your preferred and alternate caregivers too. What if your sister's Yorkshire Terrier puppy doesn't get along with your aging Shih Tzu?
For example, one client of New York estate lawyer Herbert Nass left $200,000 in trust for a cat named Ming. The trust provided that the client's doorman/caregiver was to inherit what was left in the trust after the feline's death, so long as the cat had died of natural causes. To ensure no foul play, Nass, the trustee, arranged for an autopsy on Ming (yes, it was natural causes, and the doorman got his cash).
You can fund a pet trust either through your will or while you're alive. Doing it in your will is the cheapest - possibly minimal or no extra cost if you're writing a new will and your pet predeceases you. The advantage of creating and funding a trust while you're alive is that it can kick in if you become permanently disabled and are unable to care for your pet yourself.
Common-sense check: Informal arrangements are just as important as what you might spell out in legal documents. One problem with leaving all the instructions in your will is that pets need immediate care and there could be a lapse in time before your will is read. So pick temporary emergency caregivers nearby who can step in if you're incapacitated. In fact, particularly if you live alone, make sure to carry a card in your wallet that lists your name, the number and kind of pets in your home and numbers for emergency pet caregivers.
Does a trust for a pet seem too highfalutin' for you and your mutt? There are two other approaches for protecting your pets that might better fit you and Fido.
One is to leave your pet - and a bequest - to a friend in your will. Nass has a client whose will leaves $200,000 and a parrot to a former girlfriend. "The parrot comes with a dowry," he quips. If you choose to leave a bequest, you must decide if you want to make it conditional - meaning that the caretaker only gets the money if the pet is still living at your death.
Another option: Some veterinary schools and no-kill shelters have continuing pet care programs. In these programs, the pets either live the rest of their lives on site in posh digs, or are adopted out or put in "foster care." These programs typically require you to pay an enrollment fee of around $1,000 and to fund an endowment of $10,000 and up - currently, or as a bequest in your will. (If you make the contribution now you may be able to deduct part of it - -the amount above the projected cost of caring for your pet.)
The North Shore Animal League America's Safe Haven Surviving Pet Care program in Port Washington, N.Y., allows you to fund one pet's care for $10,000 if you pay at the time of enrollment, or for $15,000 if you pay through a bequest. Care for a second pet requires a donation of $5,000 at enrollment or $7,500 through a bequest. There are 276 human enrollees who own 900 cats and dogs.
These programs aren't available everywhere, but they are spreading, with Purdue University, Kansas State University and University of California-Davis among those offering continuing pet care. Texas A&M University's College of Veterinary Medicine's Stevenson Companion Animal Life-Care Center already has 31 resident pets (15 dogs, 15 cats, and 1 llama) and 134 owners have enrolled 330 additional pets for possible future care. But the Oklahoma State University Center for Veterinary Health Services' Perpetual Pet Care Program has just 15 pet-owner enrollees for a dedicated 6,600-square-foot facility.
Meanwhile, the Humane Society of the United States is continuing to push for pet trust laws in the states still without them: Georgia, Kentucky, Louisiana, Massachusetts, Minnesota, Mississippi, Oklahoma and West Virginia. The Society estimates that 200,000 single people die each year owning one or more pets, without a plan in place for their care.
"It's an issue of personal responsibility, but also a financial issue for local municipalities and charities that take on the burden of animal care," says Michael Markarian, the Humane Society's chief operating officer. "It's simple for people to set up some process where they can have the peace of mind that the animal will be cared for by a trusted person and not just leave the issue to chance," he adds.
Markarian's group is also pushing for a federal tax law to allow for charitable remainder trusts for pets. Once the pet dies, the remainder interest would go to a charity instead of the caretaker. Rep. Earl Blumenauer, D-Ore., and Rep. Jim Ramstad, R-Minn., introduced a charitable remainder trust bill in the last Congress. Ramstad didn't run for reelection in 2008, and the Society is seeking another Republican to take Ramstad's place for the reintroduction of the bill this year. Note that the donor, if he funds the charitable remainder trust while he's alive, could get a partial income tax break.
Another income tax break being pushed by actor, animal rights activist and animal refuge founder Leo Grillo would allow pet owners to deduct as much as $3,500 of pet-related expenses from their federal taxable income. Seems a little far-fetched when the Federal deficit this year is approaching $1.2 trillion. Still, a bill to allow it was introduced in July by Rep. Thaddeus McCotter, R-Mich., as the Humanity and Pets Partnered Through the Years or "Happy" Act.
McCotter press spokeswoman Anne Tyrell says the Congressman doesn't have pets himself, but is friends with actor Robert Davi, a cousin of Grillo, and was happy to support the bill because it was "a tax [break] idea during a recession."
McCotter went digging for cosponsors and came up with two Democrats: Rep. Steve Cohen, D-Tenn, and Rep. Jared Polis, D- Colo. Who says bipartisanship is dead in Washington?
Personal FinanceExotic pets can be fascinating to look at, but most are expensive to acquire and maintain. And avoid being bitten, especially if you get a scorpion.
Personal FinanceIn the U.S., 62% of households have pets. These are some of the most common pets in the U.S. and the average costs associated with raising them.
InsuranceFind out how to protect those you love the most with specialized policies.
Personal FinanceHave you ever thought a monkey could do your job? Well, maybe it could. Here are some ways animals are replacing people at work.
InvestingHere are the top ways you can treat your canine companion.
Personal FinanceHere's a look inside the visible and hidden costs of pet ownership. There are many costs that pet owners can overlook.
Personal FinanceWhether it's taking up gardening or adopting a pet, there are many ways a person can improve his or her level of happiness without breaking the bank.
Home & AutoIf you're building a new home, try incorporating these unique features.
Personal FinanceFood recalls are common, but some food manufacturers are so large that a recall can impact the entire industry.
InsuranceHere's a breakdown of wellness plans and pet insurance, and some tips for keeping your pet healthy.
CareCredit is a health care credit card that has become well known by the general public and is also widely accepted by various ... Read Full Answer >>
Most renters insurance policies do not offer coverage, or at least full coverage, for pet damage. However, if you find yourself ... Read Full Answer >>
A 1993 law, Section 2-907 of the Uniform Probate Code, changed the treatment of a deceased individual's pet from that of ... Read Full Answer >>