Pitfalls of bequeathing money to pampered pets
NEW YORK |
NEW YORK (Reuters) - British Fashion designer Alexander McQueen did it and so did billionaire hotel operator Leona Helmsley, but legal experts warn that there can bepitfalls to bequeathing money to a pampered pet.
Between 12 and 27 percent of pet owners provide provisions for their beloved pets in their wills, according to researchers at Washington University in St. Louis School of Law.
McQueen left 50,000 pounds ($81,000) for the care of his English bull terriers when he died last year, and Helmsley bequeathed $12 million to her now-deceased Maltese, named Trouble, after her death in 2007.
"Although pet inheritance in America was recognized in 1923, and despite several recent innovations, the law remains unstable," said Washington University Law Professor Adrienne Davis.
She said trusts must be properly drafted and should name caretakers who are willing to comply with the trust terms. If a final resting place is desired for the pet, lawyers should check that it will accept animals.
Despite Helmsley's wishes, a U.S. judge reduced Trouble's bequest from $12 million to $2 million and more problems arose after the dog's recent death.
"The remainder of Trouble's money will go to Helmsley's charitable trust," said Davis, adding that gifts to charitable trusts would qualify for a tax deduction in the United States.
"However, tax law excludes charitable remainders following pet trusts from qualifying," she added in a statement.
The judge also overturned Helmsley's wish that her charitable trust go to animal welfare, and allowed the trustees to distribute the money to charities of their choice.
Helmsley also wanted Trouble to be buried in the family mausoleum but pets in the U.S. cannot be buried in cemeteries for humans.
Davis called for legal reforms to make sure pets receive what they are owed.
"One proposed bill would extend the charitable remainder tax deduction to pet trusts. Other reforms would make it easier to create trusts for future generations, or 'grand-kid pets.' That 'companion' feeling has spilled over owners' lifetimes into their estate plans, with no end in sight."
Washington University Professor Frances Foster believes that the traditional concept of family is outdated and legal changes are needed to reflect how important pets are in peoples' lives.
"Trouble -- and millions of American pets like her -- should inherit," she said in an article in the Florida Law Review.
"American inheritance law is trapped in an outdated family paradigm. That paradigm assumes that the decedent's closest relatives by blood, adoption or marriage are the most deserving recipients of the decedent's estate," she added.
But Foster said for many Americans today that is not the case because "their pets, not their human family members, are their nearest and dearest."
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