Introduction
In the state of Arizona, trusts, estates, and protective proceedings are governed by ARS Title 14.
According to the law, pets are treated as property—not as entities that can own property. Because of this distinction, an owner cannot gift money or assets to a pet. That said, it’s still important to address how your pet will be cared for when you die.
Informal agreements with friends or family can quickly dissolve if they can’t have a pet in their apartment, or they find out that someone in the house is deathly allergic to the animal. To prepare for any contingencies, and to ensure your pet doesn’t end up homeless or in a shelter, there are a few things you can do to account for their wellbeing in your formal estate plan.
A Letter of Instruction
Your family may not read your will until weeks after your death, so you’ll need to include pertinent instructions for someone to manage your affairs until the will is opened and executed. While a letter of instruction is not legally binding, it is a helpful way to provide direction to your family. People normally use a letter of instruction to indicate their death and burial plans, or to care for minor children until a guardian is formally appointed, but a letter of instruction can also be used to detail who is to care for your pet until ownership passes to a guardian.
In the letter of instruction, indicate who is to initially take in your pet, and who will ultimately keep the pet once your estate is settled (that may be the same person for both situations). It’s also a smart idea to include a backup guardian to take ownership of your pet in case the primary guardian is unable to accept the responsibility.
Before you formally nominate these people, though, be sure to speak with them ahead of time and get their permission. Again, a letter of instruction is non-binding, so even if you designate your sister to receive the pet, your sister has the right to decline, potentially leaving your pet homeless and uncared for.
Once your letter of instruction is drafted, leave a copy with your executor (the person who will manage your estate when you die), and your pet’s veterinarian, groomer, walker, and handler (if applicable).
Transferring Ownership of Your Pet in Your Will
Just as you will direct how your personal belongings should be transferred to beneficiaries in your will, you’ll need to transfer ownership of your pet through your will. It can feel insulting to treat your pet like property, but unfortunately that’s the law that we’re stuck with. Speak with friends and family members to discover who would be willing to adopt your pet, and if possible, choose a couple of individuals or families to serve as backup guardians in case your first pick is unable to care for your pet.
If you don’t establish a pet trust, it would be wise to gift a small portion of your assets to the beneficiary who will adopt your pet, to help with the costs of caring for your pet. Keep in mind, however, that you can’t dictate how the beneficiary uses the funds. Unfortunately, there is a very real chance that the $1,000 you gift to Bob and Susie will be used to get a new television instead of the lifetime supply of Kibbles and Bits you requested for your pet. That’s all the more reason to carefully choose someone to adopt your pet who will follow your instructions and take good care of the animal.
Lastly, note that while a will is legally binding, a guardian has the right to decline gifted assets—including pets. That means the individual or family you designate to take in your pet may choose they don’t want the pet when you die. Therefore, as mentioned previously, it’s wise to include a few backup beneficiaries in case your first-choice declines.
Provide Funds for Your Pet With a Pet Trust
You can’t directly transfer assets to a pet, and you can’t force someone in your will to use gifted assets to care for your pet, but you can solve both of these problems with a pet trust. A trust is a vehicle that can hold property and distribute income for the benefit of a beneficiary, and while your pet can’t receive property, they can be listed as the beneficiary of trust income.
To do this, include a provision in your will to create a testamentary pet trust when you die. You’ll need to designate a trustee to manage the assets (probably the new owner who will adopt your pet), and you’ll need to form the terms of the trust to dictate how income from the trust should be used to care for your pet. If you don’t fully trust anyone you know to control the trust, there are some organizations who will find someone to adopt your pet, and the organization will serve as the trustee to ensure your wishes are fulfilled.
If someone takes possession of your pet and later decides to give the pet to someone else, the pet trust will follow your pet—not the initial owner—ensuring that as long as your pet lives, they’ll have funds to provide for their needs.
Special Considerations When Including a Pet in Your Estate Planning Documents
Regardless of which estate planning tools you use to care for your pet, there are a few considerations you’ll need to include in the plan documents:
- A detailed description of the pet (to ensure the court can identify the animal in question, and to distinguish between multiple pets in the home)
- Identifying information for the court to distinguish the pet’s guardian and backup guardians (include full name, date of birth, phone number, and address)
- A remainder beneficiary for the pet trust, to receive residual assets when the pet dies (such as a charity or pet shelter)
- Special instructions for the pet’s care (while non-binding, this will help the pet’s new owner understand important aspects such as medical history, diet, exercise, etc.)
- Special requests to keep pets together (also not binding, but good to know)
- How and when assets should be transferred to the pet trust
- Wording that encompasses any future pets, in case your pet has offspring that you’d like to be covered by the pet trust
For long-term peace of mind, contact us to set up a consultation today. We look forward to helping with your will and other estate planning needs.
Call our Estate team at (480)467-4325 to discuss your case today.
