A Look into Pet Trusts During the Coronavirus
Have you ever asked yourself, who will take care of my pets if I no longer can? There are many reasons people find themselves needing to give up their companion birds and other animals. Death is the most obvious, but what about disability, or finding it too difficult as you become older, perhaps a family member develops an allergy, or you find yourself moving where parrots are not permitted in the home or apartment. I believe most parrot owners have thought about who might care for their feathered friends, as these intelligent creatures are not as easy to pass to a friend or relative as a dog or cat might be.
Parrots in particular require a special knowledge to care for them. You must understand their behaviors, habits, and housing requirements. A person who is unfamiliar with a parrot may mistake a parrot’s warning as a cute antic, only to find themselves with a bloody finger or nose. I know that my parrot interprets the picking up of mail or other papers from the kitchen counter as an act of war and is prepared to attack! A lot of the interior door moldings in my home have been whittled unrecognizable by my feathered carpenter… Not something everyone would see as cute!
Is the person you have in mind aware that they will inherit your companion bird or other animals should something happen to you? Do they know who the animal’s vet is? Do they understand how long a commitment they are making and what kind of regular expenses are involved in caring for a pet? To help better prepare you to make decisions about leaving your long lived and beloved companion with a friend or family member, consider preparing some information, funds and a “Pet Trust” in advance. Below is a series of common questions and answers by Estate Planning Attorney Christine Cracchiolo.
Q. Is it necessary to have a trust or will for my parrot or other animals?
A. Most people do not consider their parrot as “property” or “assets”. They consider them to be a part of the family. However, American Courts in the past have considered pets to be personal property, whether it is dogs, cats, horses, birds, etc. Having a will or trust can be very important for your companion bird, so that both the bird and any property, including financial arrangements can be made without complications.
Q. How do I find the right guardian for my Parrot?
A. The financial commitment to provide for your parrot is only half of the challenge. As a guardian of a companion parrot, you will also need to consider who is willing and able to care for the parrot. As Parrots are exotic animals that have never been domesticated, selecting an appropriate guardian may require that you socialize your parrot with individuals that may desire bringing your parrot into their family, should you no longer be able to care for your feathered friend. It is also a good idea that you familiarize the future care giver family member or friend with some basic training and have them take your parrot occasionally when you go away on vacation, so they will have a more realistic understanding of what it means to share their home with one of these intelligent creatures.
If no family or friend is able to take care of the parrot, you should consider using a pet adoption organization to locate a future caregiver. If the parrot cannot be adopted, due to behavioral issues or illness, then a Sanctuary, may be the best option. If you believe this is the case, you should consider the cost of care and documentation, just as you would in passing the companion parrot on to a friend or family member. Contact Paul Robertson, Financial Advisor, regarding the most cost effective ways of providing adequate funding and documentation.
Q. Should I name an alternate caregiver?
A. In a word, YES! You should name at least one, preferably two or three alternate caregivers in case your first choice is unable or unwilling to serve as your pet’s caregiver. As an alternate you may want to consider naming another sanctuary, a no-kill shelter, or another friend or family member as your last choice.
Q. What are the legal documents I need to prepare to care for my parrot after I pass away?
A. Once you have secured the financial means and at least one guardian who is willing and able to care for your parrot, the next step is putting it all together in a legal document. This could be as simple as leaving your parrot and the necessary caretaking funds to the guardian in your will. However, your last will and testament will not address what would happen if you were to become incapacitated or disabled.
You should consult with an attorney who specializes in estate planning, and if possible, who also has experience with pet trusts.
If you live in a state such as Arizona with a “pet trust” statute, you can create a trust for the benefit of a companion animal for its lifetime. The trustee would receive both the parrot and the funds to take care of the parrot and any person who has interest in the welfare of the parrot could enforce the terms of the trust against the trustee if necessary. This will be helpful against disgruntled heirs who could traditionally challenge the validity of such gifts on the grounds that there is no human beneficiary. A well-drafted traditional legal trust offers a more secure, albeit a little more complex avenue. Under this technique, the trustee owns and manages the caretaking funds, and the guardian is the beneficiary of the trust, who is entitled to distributions for costs or compensation.
Q. What is a “pet trust”?
A. Since a pet cannot be named as a beneficiary of money or property from your estate, a pet trust is a legal technique you may use to be sure that your parrot receives proper care after you pass away or in the event you are no longer able to care for your parrot. A pet trust is a legally sanctioned arrangement providing for the care and maintenance of one’s companion animals in the event of one’s disability or death. A pet trust is affordable and can be fairly straightforward and simple. The benefits of having a pet trust are more than simply the peace of mind of knowing your animal will be taken care of and protected.
Q. How much property do I need to fund my pet trust?
A. You will need to consider many factors when deciding how much money or other property to transfer to your pet’s trust. Keep in mind the many factors including the type of bird, and the birds' life expectancy, the standard of living you wish to provide for the animal, the possibility of expensive medical treatment, and whether or not the trustee will be compensated for his or her service.
Q. How will I fund my pet trust?
A. You may fund both inter vivos and testamentary pet trusts by naming the trustee of the trust, in trust, as the beneficiary of a life insurance policy. This possibility can be particularly helpful if you do not have or think you will have sufficient property to transfer for your pet’s care. Life insurance “creates” property when you die which you may then use to fund your pet trust. The important part is you provide instructions regarding care, feeding, exercise, veterinary care and burial. Note: Be sure to consult with your lawyer and/or Financial Advisor/life insurance agent about the correct way of naming the trustee of your pet trust as the beneficiary.
Q. If I don’t have life insurance do I have any other options?
A. Pay on death accounts, annuities, retirement plans, and other contracts may be another option: You may have funds in the bank, an annuity, a retirement plan, or other contractual arrangement which permits you to name a person to receive property after you die. You may use these assets to fund both inter vivos and testamentary trusts by naming the trustee of your pet trust as the recipient of a designated portion or amount of these assets. Note: Contact Financial Advisor regarding funding options to make sure it is in line with overall financial goals. Also, consult your lawyer or banker about the correct way of naming the trustee of your pet trust as the recipient of these funds.
Q. What is the financial commitment for caring for a parrot?
A. Two factors necessitate proactive estate planning for your parrot: the cost and longevity. Proper care of a parrot is not an inexpensive proposition. Assuming that the interest earned on the caretaking fund set aside will roughly equal the rate of inflation, the guardian of a parrot could need thousands of dollars to properly provide the same standard of care for the parrot. As you can see, caring for a healthy parrot requires a financial commitment that will very likely continue after the original guardian’s lifetime
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Q. Who can I contact if I need help setting up a trust or for options on funding or purchasing life insurance for my parrot?
A. You can contact me at ChristineF@ForakisLaw.com or 602-254-2000 to assist you with your legal structures and questions.
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