An Estate Plan For My Horses
A lot of my clients are always fascinated to learn that I have a fair amount of experience in the equine industry; yes, that technically makes me a horse lawyer.
For a few years I worked as in-house counsel for several companies; one of which was an equine breeding, training, and showing organization in the sport of hunters and jumpers. What this means is that I can tell you the details and intricacies of a live-foal guarantee, I know how many “doses” are standard in the sale of stallion breeding material, and I can also tell you the best way to create an estate plan that includes equine assets.
So what? Aren’t horses like any other pet that you can just gift to someone in your will or let your loved ones just inherit?
If you are a horse person, then you are laughing out loud at that above statement. You know better than anyone that a) horses aren’t just like any other pet, and b) accidentally giving a horse to a non-horse person would likely have them cursing you in your grave.
Unlike most pets, horses are relatively expensive to maintain, require a good amount of care and maintenance, and can bring with them a fair amount of liability if the owner doesn’t take the appropriate precautions. As such, any person who owns horses will want to take measure to make sure that a qualified person will inherit the horses; additionally, it is advisable that assets be set aside to help offset the costs of the bequeathed equine.
How exactly do you prepare an estate plan for horses? Is there anything special that you can do that helps make sure they are well cared for?
Multiple methods exist through which you can properly prepare for your horses care and maintenance after your passing. Trusts can be prepared that will ensure that your horses expenses are paid for, wills can be drafted to direct who will own your horses, and non-probate methods might be available that will simplify the transfer of your horses upon your passing.
But wait? How are horses going to affect my estate taxes? Aren’t they worth a bunch of money?
Horses can be very valuable assets; some can literally be valued in the millions of dollars. That is not to mention all of the tack, gear, facilities, businesses, and equipment you might have in relation to your horses. The bottom line is that equine assets alone can quickly lead to your estate surpassing the estate tax exemption amount.
In order to minimize tax consequences on these valuable assets, methods such as irrevocable trusts, lifetime transfers within the annual gift allowance, and setting up appropriate successor plans for your equine business can be extraordinarily beneficial.
The bottom line is that if you own a sizable amount of equine assets, you will want to speak with an estate planning attorney familiar with handling equine assets.
If you are not sure if your estate plan gives appropriate consideration to your horses, or if you are interested in having an attorney assist you in setting up an equine estate plan, Nowakowski Legal PLLC would be glad to assist. Contact us for a free consultation today!