When you create your estate plan you should make a written list of all the assets you own. In today’s electronic world, that includes your digital assets. Despite living in a digital world, people frequently fail to recognize and include digital assets in their estate plans. With that in mind, a Los Angeles estate planning attorney from Collins Law Firm encourages you to include your digital assets in your estate plan.
What Are My Digital Assets?
In just a short time frame, the internet has changed our lives significantly. In a single generation, things like laptop computers and cell phones have gone from luxury items to something the average kindergartener owns and operates, and even learns on. 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, including things such as:
- Social media accounts
- Information and data stored online or in the cloud
- Subscription services
- Email accounts
- Domain names
- Intellectual property
- Online banking accounts
- Credit card accounts
- Utility accounts
- Contact lists
- Shopping accounts
- Photo and video sharing and storage accounts
- Smartphone, computer, tablet or cloud data
- Existing digital collections
- Websites or blogs you maintain
- Online marketplace stores
- Domain names
- Cryptocurrency keys
- Text, graphic and audio files (or other intellectual property)
Can Your Beneficiaries Access Your Digital Assets?
Having a list of your digital assets will certainly be helpful during the administration of your estate; however, if your Executor and/or beneficiaries cannot access those assets, the list is all but pointless. To address this problem, many states have adopted the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA), which lays out three tiers for accessing digital assets:
- Tier 1. If a digital service provides a tool to designate what happens to assets after you die, this designation guides what happens to the account. For example, if you used Google’s inactive account manager to designate a family member, this designation would guide what happens to your Google assets.
- Tier 2. If there isn’t any tool, then the owner’s directions in a will or legal document determine the handling of the account or asset.
- Tier 3. If neither of the first two scenarios are present, the terms-of-service agreement dictates how those accounts can be accessed. As mentioned, those agreements often restrict access to the original owner.
The State of California has enacted its version of the RUFADAA known as the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) which governs how an Executor or Personal Representative handles digital assets during the administration of an estate.
How Do I Include My Digital Assets in My Estate Plan?
Your traditional Executor can handle the distribution of your digital assets; however, many people designate a separate “Digital Executor.” This person is tasked with accessing and inventorying all your electronic files. Valuable digital assets, such as intellectual property, websites, and monetized blogs can be gifted in the same manner as conventional assets are gifted in a Will or trust; however, be sure you understand the process required for transferring ownership of the assets. Gatekeeper digital assets, such as account information relating to your investment accounts, allow access to valuable assets. These assets are not valuable alone but should also be treated with care in your estate plan because they ultimately gift valuable assets.
Contact a Los Angeles Estate Planning Attorney
For more information, please download our FREE estate planning worksheet. If you have additional questions related to estate planning, consult with an experienced estate planning attorney near you. Contact the Collins Law Firm by calling (310) 677-9787 to register for one of our FREE estate planning workshops.