Minnesota Pet Trusts – Pet Estate Planning

Minnesota Pet Trusts – Pet Estate Planning

Who will take care of your Minnesota pets after your death?

Minnesota Pet Trusts – Providing for Your Animal Friends After Your Death

While estate planning strategies to provide for surviving pets are somewhat more limited than they are for their human owners, there are a few things that an animal owner can do to provide for his or her pet’s well being after the death of the animal owner.

Minnesota Pet Trusts – Finally in Minnesota

As of July 1, 2016, Minnesota became the last state in the union to allow the creation of Minnesota Pet Trusts for the primary benefit of one or more animals which are alive during the trust settlor’s lifetime.

Minnesota Pet Trusts – Maximum Funds

The Minnesota Pet Trusts statute does not identify a maximum amount of funds which can be set aside in Minnesota Pet Trusts, although a Minnesota court can determine that the value of the trust property which was declared to be in trust exceeds the amount which is required for the intended use.

Minnesota Pet Trusts – Enforcer

During the lifetime of the animal beneficiary or beneficiaries, the governing documents for Minnesota Pet Trusts can identify one or more human persons who can enforce the terms of such trusts against the trustees.

However, if the governing documents for Minnesota Pet Trusts fail to identify any such human persons to enforce the terms of such trust against the trustees, the court may appoint such persons.

Minnesota Pet Trusts – Interested Persons

In addition, any person having an interest in the well-being of animals identified in Minnesota Pet Trusts may request the court to appoint a human person to enforce the terms of Minnesota Pet Trusts against the trustees, or to remove any such appointed human persons.

Minnesota Pet Trusts – Termination

Minnesota Pet Trusts will terminate:

• upon the death of the animal identified in the Trust – if only one animal is identified in the Trust, or
• upon the death of the last surviving animal – if more than one animal is identified in the Trust.

Upon termination of Minnesota Pet Trusts, or prior to the termination of Minnesota Pet Trusts, if a court determines that any given Minnesota Pet Trust has excess funds:

• the trustee shall transfer the unexpended or excess trust property pursuant to the terms of the trust governing document; or
• if there is no such provision in the trust’s governing document, the assets of the Minnesota trust passes to the trust settlor’s heirs-at-law who are to be determined as if the trust settlor died intestate domiciled in this state at the time of distribution.

Minnesota Pet Trusts – Medical Assistance Program Issues

The Settlors of Minnesota Pet Trusts cannot avoid their responsibilities to pay for the cost of Minnesota nursing home expenses pursuant to the use of Minnesota Pet Trusts.

Therefore, any Minnesota County which has provided Minnesota Medical Assistance program benefits to Trust Settlors can file a claim against the Settlor’s estate, or against the trust assets, for the recovery of any Minnesota Medical Assistance program benefits provided to Trust Settlors.

Minnesota Pet Trusts – Taxable Income

During the term of Minnesota Pet Trusts, any taxable income earned by Minnesota Pet Trusts will be fully taxable to such trusts – without any offsetting deduction for distributions for the care of the animal beneficiaries.

Minnesota Will Provisions – in Lieu of Minnesota Pet Trusts

If animal owners do not want to go to the expense of creating one or more Minnesota Pet Trusts, the animal owner’s Will can nominate one or more persons to care for his or her pets after the owner’s death, pursuant to clauses similar to the following:

My personal representative(s) shall deliver custody and ownership of my beloved dog, Scooby (hereinafter, “Scooby”), and my precious cat, Boots (hereinafter, “Boots”) – if they are living at my death – to my trusted friends, Fred and Wilma Flinkstone, currently residing at 9 Rubblestone Court, Granite City, Minnesota, or to the survivor thereof, if one or both of them survive me.

If both of my friends, Fred and Wilma Flinkstone, fail to survive me, or are otherwise unable to accept custody and ownership of either Scooby or Boots, my personal representative(s) shall deliver custody and ownership of Scooby and/or Boots to my sister Betty Ruble, and to her husband, Barney Ruble (providing that he is then married to Betty), currently residing at 10 Rubblestone Court, Granite City, Minnesota, if Betty Ruble survives me.

If Betty Ruble fails to survive me, or if Betty and Barney Ruble are otherwise unable to accept custody and ownership of Scooby and/or Boots, my personal representative(s) shall deliver custody and ownership of Scooby and/or Boots to such persons or organizations as my personal representative(s) determines to be best able to care for Scooby and/or Boots.

Minnesota Will Provisions – Financial Gifts

The animal owner’s Will can also provide one or more financial gifts to the person or persons who agree to care for the animal owner’s pets after the owner’s death, pursuant to clauses similar to the following:

My personal representative(s) shall distribute:

• $1,000.00 to the person or persons who, or to the organization which, accept(s) custody and ownership of Scooby – to be used for Scooby’s care and maintenance, and
• $1,000.00 to the person or persons who, or to the organization which, accept(s) custody and ownership of Boots – to be used for Boots’ care and maintenance.

Minnesota Will Provisions – Temporary Custodial Care

The animal owner’s Will can also direct the personal representative(s) of the animal owner’s estate to  temporarily care for his or her pets until they can be delivered to the ultimate caregivers for the pets, pursuant to clauses similar to the following:

My personal representative(s) shall upon my death provide for the immediate care of my beloved dog, Scooby, and my precious cat, Boots – if one or both of such pets of mine are living at my death – and shall as soon as possible after my death transfer custody and ownership of Scooby and/or Boots to the person or persons who are, or to the organization which is, entitled to their custody and ownership.

I direct that my personal representative(s) be reimbursed for all costs of caring for Scooby and Boots until their custody and ownership can be transferred to the person or persons who, or to the organization which, accepts responsibility for their care.

Minnesota Will Provisions – Gifts to Animal Shelters

Prior to death, animal owners can also make one or more lifetime gifts, or an animal owner’s Will can make one or more testamentary gifts, to an animal shelter or veterinary care institution which will either care for the animal owner’s pet, or locate a foster home for the animal owner’s pet, after the animal owner’s death.

Several Minnesota nonprofit agencies and educational institutions will either care for the animal owner’s pet, or locate a foster home for the animal owner’s pet, after the animal owner’s death, providing that such agencies or institutions are the recipient of either a lifetime gift, or a testamentary gift, of some specified minimum amount.

If an animal owner intends to have such a nonprofit agency or educational institution care for the animal owner’s pet after the animal owner’s death, the agency or institution should be identified in the animal owner’s Will as being entitled to receive custody and ownership of the animal owner’s pet pursuant to a clause similar to that identified above.

Certain financial gifts to these nonprofit agencies and educational institutions may be tax deductible.

However, an animal owner should verify the propriety of taking a tax deduction with respect to such gifts with a qualified tax advisor.

Conclusion – Minnesota Pet Trusts – Pet Estate Planning

While estate planning strategies to provide for surviving pets are somewhat more limited than they are for their human owners, there are a few things that an animal owner can do to provide for his or her pet’s well being after the death of the animal owner, including the creation of one or more Minnesota Pet Trusts for the primary benefit of one or more animals which are alive during the trust settlor’s lifetime.

Copyright 2018 – All Rights Reserved

Gary C. Dahle – Attorney at Law

2704 Mounds View Blvd., Mounds View, MN 55112

Phone:  763-780-8390  Fax: 763-780-1735

gary@dahlelaw.com

Legal Disclaimer

Information provided herein is only for general informational and educational purposes. If you have a specific legal problem about which you are seeking advice, please consult with your own attorney. Gary C. Dahle, Attorney at Law, is licensed to practice law only in the State of Minnesota, in the United States of America.

Therefore, only those persons interested in matters governed by the laws of the State of Minnesota should consult with, or provide information to, Gary C. Dahle, Attorney at Law, or take note of information provided herein. Nothing herein will be deemed to be the practice of law or the provision of legal advice. Clients are accepted by Gary C. Dahle, Attorney at Law, only after preliminary personal communications with him, and subject to mutual agreement on terms of representation.

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