Balancing Protection, Access to Your Digital Assets

Tab 1

May 06, 2016


The concept of digital assets is fairly new in the estate-planning process. While it’s entirely possible to protect and pass down your digital assets, the realities of online life today do not make it easy. And due to the commonsense steps we all take to keep our digital assets safe in life, it can be difficult or even impossible for family members and fiduciaries to inventory and distribute them after death.

 

Digital assets can include any electronic record, including:

 

  • Email
  • Contact lists
  • Text communications
  • Social media posts
  • Bill-pay services
  • Tax-relevant documents
  • Convertible cryptocurrencies (there are 500, including Bitcoin, Dogecoin, Dash, etc.)
  • Unpublished personal and purchased visual artwork
  • Family photographs and videos
  • Purchased movie, music and literary collections
  • Online games, including game winnings and possessions
  • Browser, purchase, travel histories
  • Domain-name ownership and other documents stored on the cloud

A major frustration for anyone trying to organize a person’s estate is that 55 percent of the U.S. population has no will, according to a survey on estate planning conducted in March 2007 by Harris Interactive. An unknown subset of that group has assembled some semblance of directives, but they are stored digitally — along with all the other hard-to-access assets.

Tab 2

May 06, 2016


This is a bigger problem than many think.

 

“Every 60 seconds on the Internet, more than 168 million emails are sent,” explains Jim Lamm, estate planning and tax attorney at the law firm Gray Plant Mooty in Minneapolis. “Over 695,000 Facebook status updates are posted. Over 48,000 apps and 15,000 songs are downloaded from Apple’s iTunes store. Over 31,000 digital photos are added to Instagram. And over 72 hours of digital videos are posted on YouTube.”

 

Agreement defaults to greatest safety

 

The privacy parts of online agreements are designed expressly to try to prevent anyone but the account’s owner from accessing its contents. Some — but not all — contracts allow owners to make provisions for access in the event of death, but people have to actively permit this: the default is maximum protection.

Lamm remembers the tragic case of a 20-year-old Marine killed in Iraq whose estate ran afoul, owing to the online contracts everyone signs without considering or even reading when setting up an online account.

 

“The Marine had been communicating extensively with his family and friends using a Yahoo email account while he was overseas,” Lamm recalls. “He didn’t plan ahead, and following his death, his family wanted copies of the emails to remember him by. But they had to take Yahoo to court to try to obtain those emails. Unfortunately, they weren’t able to get them all.”

 

Three steps in preparing access to assets

 

There are three main steps that you can take to make preparing access to assets less of a nightmare. However, it must be noted that without advance planning, some digital assets might be forever beyond the reach of family members and fiduciaries.

Tab 3

May 06, 2016


 

1. Make a list of your digital property. Make a list of your important passwords, online accounts and digital property. Specify what should be done with each item on your list if you become incapacitated or after you die. Keep your list up to date, store it in a secure location – such as a safe deposit box or home safe – and let your fiduciaries and family members know how to access it.​

 

2. Review user agreements for all relevant products and services. Your rights and planning options for online accounts are governed by the provider’s Terms of Service Agreement. Review that agreement for your rights upon death or incapacity, and determine whether you would be able to transfer your account or the data stored in your account.

Some providers, including Google and Facebook, now offer options to manage aspects of your account after death or transfer data stored in your account after death.

 

3. Ask your legal advisor to help you develop a document outlining your plans for digitalproperty. Remember that you are not alone. U.S. Bank recommends speaking with your estate-planning attorney about relevant laws regarding fiduciary access. For example, under the uniform law that is being introduced all over the country, an individual’s authorization is required for access to the content of the user’s electronic communications (email contents, private social media postings, cloud-stored documents, etc.). Your attorney can update your estate plan to authorize fiduciary access to your digital property and specify your plans for your digital property.

 

Please see important information below.

Categories:
Wealth Transfer , Online Exclusive