Friday, October 31, 2014
Until recently, estate planning meant doling out items such as cash and securities, tangible personal property, jewelry and collectibles, and intangible assets like patents or shares. Now there is a new category that must be addressed known as “digital assets.”
Digital assets refer to the footprints we leave behind as we increasingly live our lives online. Many of us have digital assets in the form of e-mails, family photos, social media, and online bank accounts.
While managing all the passwords and leaving records of them for your loved ones is confounding, there are two other issues. The first issue is whether these assets are even transferrable. For example, when you download iTunes, e-books and audiobooks, you are only receiving a life estate, which is the right to use something while you are alive, but not to pass it on to your heirs.
The other problem centers around whether you can lawfully give other people access to your accounts. A large portion of estate planning is appointing an individual to act on your behalf if you become disabled or die. These people, known as fiduciaries, should have access to these accounts. However, user agreements generally prohibit this since companies fear violating federal privacy laws.
Users should put precautionary measures in estate planning documents to give their fiduciaries access to the accounts. This wording should go into a person’s will, living trust, and durable power of attorney.
See Deborah L. Jacobs, The Digital Footprints That We Leave Behind, Forbes, Oct. 31, 2014.