Saturday, December 25, 2010
When most people think about estate planning, they think about what is going to happen to their family and personal belongings after they pass on or become disabled. To a horse owner though, their horses are just as big of a part of their family as their children. Therefore, it is important that your equine companions are taken care of even when you cannot take care them yourself.
Until recently, you may have considered a provision in your will leaving your horses to a relative and hoping that they were cared for as you would. But there is another option, a pet trust. This article will explain what a pet trust is and the importance of having a trust in place for the care of your animal.
What is a pet trust? A pet trust is an estate planning instrument that allows you to put certain property or money into a trust for your horse’s care when you pass away or become disabled. The trust will allow you to continue to care for your horse after you pass away.
Creating a pet trust can be difficult, but an experienced attorney can help you through the process. When you create a pet trust, you become the settlor of the trust. In the legal field, this means that you will place property in trust for the benefit of beneficiaries. The property could be personal property or money.
You will name a trustee who will be responsible for carrying out your wishes regarding your horse’s care. The trustee will be the person or organization responsible for distributing your trust funds. The trust document will provide detailed instructions to the trustee regarding how the trust funds are to be used. For example, you can determine that part of the funds need to be reserved for emergency medical care or special feed.
In your trust you will also need to name a caretaker for your horses. This is the individual that you want to care for your horses when you longer can. You may want to include an alternative caretaker in the event that the named caretaker is unwilling or unable to care for your horse.
The trust should also contain very detailed instructions to the caretaker regarding the type of care that you want your horse to receive. You may want to specify any habits, special needs, or vices that your horse has. If you have a preference regarding end-of-life decisions for your horse, you will want to list those in the trust. There are several decisions and guidelines that may be placed in the trust. Each instruction you place in the trust will allow you to rest assured that you horse will be taken care of to your standards.
Why is a pet trust important? In order to understand why a pet trust is important, you have to understand how it works. To work properly, there has to be assets in the trust. The only way that assets are placed into the trust is if you, as the settlor, place them there. This is done be re-titling specific assets of your choosing into the trust’s name. Without assets, the trust is simply an empty bucket and cannot provide for your horse’s care. Too often, individuals will set up a trust and never transfer assets into it. What results can be detrimental to your equine family members.
Under the law, horses are personal property. When you pass away, if you do not have an estate plan in place, your personal property goes through the probate court system. This means that the court may sell your horses to settle any outstanding debts you may have. By creating a pet trust that is properly funded, you can avoid probate and ensure that your horses remain part of the family. Additionally, the property that is placed in the trust will also avoid probate.
Currently, there are several states that provide for pet trusts. These trusts include traditional pet trusts, such as the one described above. But there are also a number of states that allow for statutory pet trusts. These trusts do not require the horse owner to make decisions regarding terms of the trust. Rather, the owner must only use specific language in their will. When issues arise regarding how the trust is to be distributed, state law fills in the gaps.
If you are concerned about caring for your horses after you no longer can, you should consult with an experienced estate-planning attorney that understands equine law. They can help guide you through the process and provide you with insight into what you may include in your pet trust.