While most individuals understand the necessity of estate planning for tangible assets, many have only just begun to consider the management of their intangible, or digital assets, after they are gone. Because the majority of Americans possess digital assets, these too should be contained in a comprehensive estate plan. Here, estate planning attorney Douglas C. Lauenstein explains what you should know about digital assets and your estate plan.
The Term “Digital Assets” Has a Broad Definition
According to The Maryland Fiduciary Access to Digital Assets Act (SSB239/HB507), signed into Maryland law in October of 2016, digital assets are defined as, “an electronic record in which an individual has a right or interest.” This qualifies a wide array of digital content to be considered a digital asset, including but not limited to social media accounts and their contents, email accounts and their contents, online banking accounts, online investment portfolios and other financial accounts, photos, e-books, music, videos, YouTube accounts and their contents, dating profiles, marketplace accounts, blogs, file sharing and storage accounts, as well as their contents and more.
It is important to note that some online entities, such as Yahoo, have language in their Terms of Service that prohibits accounts from being transferred to another individual—so, while the content of the account may be transferrable, the account itself might not be. Consult with an estate planning attorney if you have questions about Terms of Service for any online entities.
Maryland Legislators Have Passed a Law Providing Guidance About Digital Assets
As mentioned above, The Maryland Fiduciary Access to Digital Assets Act (SSB239/HB507), signed into law in October of 2016, was created to provide guidance when managing and planning for digital assets. The bill allows users, “in a will, trust, Power of Attorney, or other record, [to] allow or prohibit disclosure to a fiduciary of some or all of the digital assets, including the content of electronic communications sent or received by the user.” The user of the digital assets may also grant either partial or full access to another individual, and the custodian—or individual given access—may charge a reasonable fee for managing, handling or disposing of the digital asset.
Powers of Attorney have also been impacted by the bill, which provides language that covers digital assets: “With respect to this subject, in accordance with the Maryland Fiduciary Access to Digital Assets Act, my agent shall have authority over and the right to access the content of any of my electronic communications, any catalog of electronic communications sent or received by me and any other digital asset in which I have a right or interest.”
There are Several Ways to Ensure Your Digital Assets are Protected
A custodian or fiduciary can only have access to the digital assets you disclose, so take the time to create a comprehensive list of the digital assets you own—this list should include usernames, account numbers, email addresses, passwords and any other information an individual would require to access the asset. Keep this list in a safe location, update it as needed and let a trusted representative know where the list can be found.
Some online entities, such as Google or Facebook, allow you to choose a beneficiary for your accounts. Ensure that the beneficiary named online is the same one you name within your estate plan so that there are no conflicts regarding who has the right to access your assets.
Finally, consult with an estate planning attorney to draft an estate plan that accounts for your digital assets. As an estate planning attorney, Douglas C. Lauenstein has worked for years to help individuals protect their tangible and intangible assets and ensure that their wishes are carried out after they have passed on. To discuss your estate planning needs, contact The Law Offices of Douglas C. Lauenstein today.