When you think about estate planning, one of your primary concerns is probably protecting your assets. To do that, you need to include them in your estate plan and decide how they will be passed down to loved ones after you are gone. Until fairly recently, including your assets in your estate plan was pretty straight-forward. In today’s electronic age, however, the definition of “assets” has changed dramatically, meaning the way we create our estate plans needs to change as well. Are your digital assets already part of your estate plan? If you are like most people, the answer is “no.” The Phoenix and Mesa estate planning lawyers at Morris Hall PLLC explain what digital assets are and why they need to be included in your estate plan.
Do You Own Digital Assets?
The advent, and subsequent rise, of the internet has changed our lives dramatically in an extremely short period of time – at least in the grand scheme of time. In just one generation, things like laptop computers and cell phones have gone from luxury items to something the average kindergartener owns and operates (often better than the adults in her world). Regardless of your age though, you almost certainly own digital assets. The first step toward including them in your estate plan is to identify them. With that in mind, take some time to make a list of the following digital assets you might own:
- Computing hardware — computers, external hard drives or flash drives, tablets, smartphones, digital music players, e-readers, digital cameras, and other digital devices
- Information or data — stored electronically, whether stored online, in the cloud, or on a physical device. Don’t forget accounts such as Shutterfly, Google photos, and other photo storage sites. For each account, make sure you identify where it is located, your user name, and password.
- Online accounts — email and communications accounts, social media accounts, shopping accounts, photo and video sharing accounts, video gaming accounts, online storage accounts, and websites and blogs that you may manage. For each of these, you will also need to make a note of your user name and password.
- Financial and bill paying accounts — Checking and savings accounts, retirement accounts, trading accounts, investment accounts, utility payment accounts, credit card accounts, house and vehicle loans
- Domain names
- Intellectual property — copyrighted materials, trademarks, patents, and any code you may have written and own
How Does the Law Handle Digital Assets?
The rapid increase in the use of electronic communications and storage is leading many states to enact legislation aimed at protecting or managing your digital assets. Like many states, the State of Arizona recently enacted the “Revised Uniform Fiduciary Access to Digital Assets Act” that went into effect in August, 2016. The law governs the disclosure of digital assets to a fiduciary and procedures for a fiduciary’s access to those assets. You will also find that many companies are also addressing the issue of access directly. For example, Google offers account holders the opportunity to use its “Inactive Account Manager.” Inactive Account Manager lets a user decide what happens to their account if the account becomes dormant for a specified period of time. After your account has been inactive for six months, for example, you can designate someone to whom you grant access to the account.
Including Your Digital Assets in Your Estate Plan
In some ways, including digital assets in your estate plan is more difficult than including traditional assets. With digital assets, you must first plan for access to the asset. You may choose to rely on your traditional Executor or you may decide to designate a separate “Digital Executor” to go through and access all your electronic files. You must then decide what happens to those assets. For assets with value, such as intellectual property, websites, and monetized blogs, you can gift them in your estate plan just as you would a conventional asset; however, the process for transferring ownership may be a little different. Other assets act more as “gatekeepers” for valuable assets. Account information relating to your investment accounts, for example, may not be valuable in and of itself, but it will allow someone to access a valuable asset. As technology changes, and new laws impact your digital assets, you will need to review and revise your estate plan accordingly.
Contact Phoenix Estate Planning Lawyers
For more information, please join us for an upcoming FREE seminar. If you have additional questions or concerns about including digital assets in your estate plan, contact the experienced estate planning attorneys at Morris Hall PLLC by calling 888-222-1328 to schedule your appointment today.