To write a tax blog, you have to love taxes. The trouble is, the Internal Revenue Code doesn't come running to jump in your lap and lick your face when you get home at night. You see, the Code doesn't love you back. But a dog? A dog loves you unconditionally and is always happy to see you.
Its for this reason that I wanted to post this article about estate planning for family pets. No. This is not going to tell you that your cat needs a will or that your goldfish needs a healthcare power of attorney. Rather, it discusses the need for planning what will happen to your pets if something happens to you. Because estate planning often involves tax considerations, I thought that this would be appropriate on this blog (albeit tangential).
"Who Did You Get to Watch the Dog?" By Michael Berzowski.
"It goes without saying that pets play an extremely significant role in the lives of many individuals, ranging from companionship or exercise partner to positive health impact such as lower blood pressure, reduced stress, anxiety and depression and acceleration of recovery following hospitalization.
This article addresses the issue of who will take care of your pet if you are unable to do so. It is often assumed that a family member or close friend will undertake responsibility. Since this is not true for all pet owners, some planning may be in order to provide for the health and welfare of your pet. Planning would be particularly desirable if you live alone, have a challenging or multiple pets, your pet requires special care or you simply do not know anyone who would meet your standards.
Some people pursue informal arrangements which amounts to discussing matters resulting in an implied arrangement that the individual will assume responsibility for the pet. Besides being unenforceable, these arrangements frequently overlook the financial demands to make custody successful.
In order to increase success, you should consider gravitating toward formalized planning. The first step should be preparation of an animal card to include a photo of the pet, its location and identifying the individual to contact in the event of an emergency. Related would be the preparation of more detailed instructions for the animal’s immediate care if you die or become incapacitated. Both cases should address access to the pet. Finally, you may wish to consider posting signs regarding the pet on the entrances to your dwelling, alerting individuals entering the house that pets are inside.
There are various choices with regard to pet protection. One technique creates an enforceable lifetime or testamentary trust in favor of a human beneficiary with the trustee required to make distributions to the beneficiary to cover the pet expenses, provided the beneficiary is taking care of the pet. Another technique would follow the Wisconsin Pet Trust Law, Wis. Stats. 701.11, which allows for the creation of an honorary trust for the benefit of the pet. The problem is that the trustee cannot be forced to use the property for the pet because honorary trusts are unenforceable. If the trustee fails to act, then a resulting trust arises in favor of the transferor’s estate and a court is authorized to order the transferee to transfer the property.
There are other choices and issues. This article merely scratches the surface with regard to the subject with its goal being to trigger a general awareness. If you decide to do something, you will have ample opportunity to address the nuances and material considerations such as the character of the trustee and the beneficiary, as well as other available courses of action."