Texas Estate Planning

How Do I Address Digital Assets in Estate Planning?

Many states consider the digital accounts you have and access online to be no different from the tangible personal property you own, like cars, real estate and jewelry.
Los Altos (CA) Online’s recent article entitled “Creating an estate plan for your digital assets” says that you can control what happens to these digital assets after you die. However, you need to take specific actions to ensure that your wishes are followed. Let’s look at how to do it:
1. Create an inventory. With everything you have online these days, you should categorize your digital assets. They might include online data storage accounts; emails, texts and contacts; social media accounts; and shopping accounts. You should identify all your financial accounts – bank, brokerage and retirement and bank credit card. However, those should be addressed through your estate planning documents in the traditional manner.
2. Determine who you want to receive your digital assets after you are gone. Think through who gets what, just like your tangible property.
3. Designate a fiduciary. This is a trusted agent named in your will or trust with the authority to access your digital assets. It can be the same individual for all of them but need not be. You should also include in an addendum your wishes for the disposition of each asset. Work with an experienced estate attorney to make certain that your estate documents accurately reflect your intentions.
4. Determine the fiduciary’s ability to access your digital assets. Social media terms of service agreements (TOSAs) usually state that all posted content becomes the property of the custodian (the service provider), and nearly all TOSAs prohibit third-party access to digital assets after the user dies. However, if your will or trust explicitly grants a fiduciary access, the TOSA will no longer prevail. The custodian will be required to allow access to the digital assets by the fiduciary. The custodian has the right, however, to require evidence of the fiduciary’s authority, and could make the process difficult.
Another option is to leave the fiduciary a list of login IDs and passwords for the sites and/or the data – assuming, of course, that you strongly trust the person you’ve appointed as fiduciary. You can make a list on paper or use password-generator application which requires a master password. You should also be certain to include instructions for any two-factor authentication you may have set up.
Don’t list any user IDs and passwords in your will because they would become visible as a public record after death.
Reference: Los Altos (CA) Online (May 5, 2021) “Creating an estate plan for your digital assets”

Who Gets Mom’s E-books When She Dies?

Including digital assets in your estate plan, is not just for Bitcoin owners. What about less complicated digital assets, like a library of e-books or family photos that were stored in the cloud? There are a number of steps everyone needs to take, says The Eagle in the article “Your digital estate: 3 tips for the seasoned crowd.” Even if you don’t consider yourself “seasoned,” these are important steps to take to protect your online life, from fiction to finance.

Knowledgeable boomers know they need to double check their account titles, wills, trusts, insurance policies and powers of attorney. However, they don’t all realize how much of their lives is conducted online and how important those assets are to their estate plan.

Digital estate planning focuses on organizing digital assets of all kinds and making the correct arrangements for what will happen to them, after you either pass away or become incapacitated. 

You don’t own any cryptocurrency? Do you have a Facebook page? Have you ever created a website or a blog? What about a LinkedIn profile? See—you have digital assets. You need a plan.

The best way to start is similar to what you do with tangible assets. Start with a list:

• Hard assets, including computers, laptops, digital readers like Kindle or Nook, smart phones and external data storage drives.
• Social media and networking sites—everything from Facebook, LinkedIn, Twitter, Instagram, Snapchat, etc. Be sure to also include any gaming websites.
• Online data storage accounts, like Dropbox.
• Domain names, regardless whether you built a website for the name.
• Intellectual property

There’s sentimental value to many of these accounts, like the photos stored in the cloud. There’s also practical value. If you pass away and your family is widespread and connects regularly on social media, would it be helpful for a family member to log into your social media accounts and share information about your passing? We used to have obituaries published in local newspapers, but today we post information online.

There may be financial value as well. If you own a website that contains copyrighted material or intellectual property, you will want an executor to gain access. You’ll also want to address the issue of your emails, especially if you are a business owner.

The next step is to review the list and see what, if any accounts, you don’t use anymore and would like to shut down. Then begin looking at each digital account you have and find out how each platform addresses access, after the owner has died or become incapacitated. Facebook allows users to memorialize the account and preserve the space for friends and families to share memories. Twitter allows immediate family members to deactivate the account, as long as proof-of-death can be documented. Google has an Inactive Account Manager service that permits the account to be transferred to a designated person, after a certain period of account inactivity.

Social media websites are increasingly aware of the issue of account owners dying, and every platform has its own process, so you’ll need to go through each, one by one.

Next, you’ll need to name a digital executor. This is not, as yet, a legally enforceable role, but it will make winding things down much easier. Your digital executor will need your passwords and user names, but they will not be able to simply log in and make changes using that information. 

Reference: The Eagle (Nov. 8, 2018) “Your digital estate: 3 tips for the seasoned crowd”

Life and Death Have Both Gotten More Complicated

Estate planning must now include intangible assets that didn’t exist just a few years ago, as well as those that have been around since people started owning private property. Today, says Forbes in the article “Estate Planning for Crypto And Other Digital Assets: What You Need to Know,” there are new kinds of property and new laws that govern them. 

Some of the old rules still apply and you need a will. One of the things in that will, needs to be naming an executor who will be in charge of ensuring that your assets are distributed, according to the wishes you state in your will. When it comes to digital assets, things get a little tricky.

The hardest part of digital assets for many people, is how to give access to your digital property. The law has changed. If you own cryptocurrency, you’ll need to list your “crypto keys,” so your executor and heirs can know what is in your estate and be able to access it.

You may need to educate them, so they understand what the assets are, the location of the keys and access control that you use for security. You probably know access control as PINS, passphrases, multisignature or timeclock requirements. 

The challenge is, if you die and no one has access to your cryptocurrency keys, your heirs may never be able to access them. They’ll need to know what exchanges you use (Bitcoin, Ethereum, and others) and a list of the digital wallets you own for each.

Most heirs want to sell the crypto property quickly, since the currency is volatile. No one wants to be criticized for losing substantive value in the estate, because they didn’t move quickly enough.  They also don’t want to be brought to court, for failing to look out for the fiduciary interests of the estate.

You’ll need both the proper legal planning and technical planning. 

Most states with laws about digital assets, have adopted a model that was written to include things that have not been invented yet. 

Electronic signatures on wills, is another digital issue entering the estate planning arena. Most estate planning attorneys are not enthusiastic about this.  However, the change is coming, says an attorney on the drafting committee of the Uniform Law Commission.

National College of Probate Judges President Tamara Curry says she expects that judges are going to have to get up to speed on crypto assets in the next three to five years, since courts will become inundated with estates that include crypto currency and other digital assets.

Resource: Forbes (Aug. 14, 2018) “Estate Planning for Crypto And Other Digital Assets: What You Need to Know”

Digital Assets Update: A New Kind of Property

So much of our lives is lived online, that we don’t give it a second thought—until a person with an active digital life passes away. Then what happens? According to this article from the American Bar Association’s Real Property | Trust and Estate Law Section titled “Digital Property FAQs,” it’s not as simple as logging in using your family member or friend’s user name and password. 

What happens to digital accounts after a person passes, depends upon the laws in your state and the terms of service the user agreed to when opening an account with each digital platform. Just because you are the executor or personal representative of the decedent, does not automatically give you access to their online accounts. The decedent must have given you specific consent following the rules of that social media platform.

As social media became more entrenched in our culture, the laws about their use and ownership have been developing. Little is simple anymore.

If you die in a state that has adopted the “Revised Uniform Fiduciary Access to Digital Assets Act”, which is something many states have done, your legal representatives will only have access to your accounts, if you’ve activated a setting within the account and provided a direction to disclose the contents of your account to your representatives. Alternatively, if your will specifically allows your legal representative to access your online accounts, your executor may be able to access your accounts.

If you haven’t provided consent in either of these two ways, then your executor will have a struggle ahead.

If you die in a state that has not adopted this law, then the social media platform’s rules will govern who has access to the account. 

You cannot legally log into someone’s accounts just because you have the passwords and user names, if the terms of service governing the account prohibit it. Some online accounts say in the terms of service that only the original user can access the accounts, even if they are deceased!

Check with an estate planning attorney who understands the new laws concerning digital assets. You’ll want to address access to your digital property in your will and be sure that it includes online accounts and electronic communications. You should also check the settings on all your online accounts to direct the provider to release your digital property to your legal representatives and activate the setting.

Reference: American Bar Real Property|Trust & Estate Law (July 12, 2018) “Digital Property FAQs”

Are You Sure You Want THAT in the Cloud?

There are some clear benefits to storing your will and documents online. You and your spouse (or other authorized people) can access them anytime, from anywhere. We are used to putting our lives online.  However, there are also some downsides to consider before doing so, according to a helpful article from CNBC titled “Here’s what you need to know before storing your will online.”

It’s good to have all your important documents in one place. Make sure that the people who will need access, such as executors, know that you’ve done so or the cloud storage may well be pointless.

Online storage can also facilitate family conversations about estate planning. Even tech savvy adult children who scoff at parents who don’t engage in social media, will be impressed by a decision to go digital.

 However, there are pitfalls.

The Revised Uniform Fiduciary Access to Digital Assets Act allows those who are appointed as fiduciaries to access some digital assets in the 45 states (and D.C.) where the law is in place, according to the Uniform Law Commission. ULC is a state-supported organization that brings uniform laws to different jurisdictions. 

 However, unless you give full access to your digital accounts to your attorney or executors, they will not have the right to open these accounts. They might be able to go online to bank accounts but not to your social media accounts or any portals containing important documents.

You need to give an executor access. That means more than your password, log in information and answers to security questions. They will also need a legal document granting them access to the accounts.

Check with your estate planning attorney to learn your state’s requirements. Whether or not your estate planning documents are in the cloud, you probably have digital assets. Make sure your will is updated.

Resource: CNBC (July 26, 2018) “Here’s what you need to know before storing your will online”

Digital Estate Planning

What happens to your digital assets after you pass away? This is something of a legal grey area.

If you live in a state that has not passed any laws concerning access to a deceased person's digital accounts, then the policies of each company with which you have an account will determine who will have access to them and under what circumstances.

A few states have specific laws on the books, but even those laws vary from state to state. In 2014, the Uniform Law Commission sought to remedy this situation by drafting model legislation for states to pass. More than half the states looked like they were going to pass some version of the legislation. However, technology companies lobbied fiercely against it.

In response, the model legislation was revised in 2015 to address the concerns of the technology companies. As Private Wealth points out in "The Virtual Estate," there is an extremely important difference between the two versions of the legislation.

In the original version someone who did not want his or her digital assets to be handled under the law could "opt-out" of it. However, the revised version requires people to specifically "opt-in" to the provisions of the legislation in their wills for their digital assets to be handled under the law. Thus, people without wills would not have their digital assets handled according to the legislation's provisions.

Because of the uncertain nature of the laws, it is important that you talk to your estate planning attorney about handling your digital assets under whatever laws are applicable in your state.

Reference: Private Wealth (June 17, 2016) "The Virtual Estate"

Apple Tells Widow to Get a Court Order

To call Apple's ID policies when a person passes away strict would be an understatement. 

Peggy Bush, a Canadian widow shared an iPad with her late husband on which she liked to play a card game. When she began having problems with the game her family decided to try reinstalling the game. 

Unfortunately, Bush did not know her husband's Apple ID. 

When her daughter called Apple she was initially told she would need to produce her father's will and death certificate to get the password. 

When those were procured, Apple still refused to help. 

Many phone calls later the family was told by Apple that they would need to get a court order for Apple to give them the password. 

CBC News reported this story in "Apple demands widow get court order to access dead husband's password."

This is becoming a very common problem, and not just with Apple. Tech companies each have their own policy concerning when they will allow access to a deceased person's account. Despite the often express wishes of the deceased some companies will never allow access to accounts without a court order. 

With business and financial transactions increasingly taking place online executors and family members often need account access to handle the estate.

State legislators across the county are attempting to come up with a solution to this problem. Until it is fully resolved the best practice is to make sure the executor of your estate has a way to learn your account passwords. That way he or she can easily gain access to important accounts.

Reference: CBC News (Jan. 18, 2016) "Apple demands widow get court order to access dead husband's password."

 

The Changing Face of Grief

If you are a frequent user of Facebook or Twitter, then you have undoubtedly noticed that whenever a well-liked celebrity passes away the social media sites are flooded with an outpouring of grief. Even if you were not a fan of the deceased, it is impossible to avoid the outpouring. 

Someone you know will post something that will make its way to your feed and many other people will comment on it. 

According to MIT Technology Review, in an article entitled "The Internet Has Changed How We Deal with Death," this phenomenon is not going to go away. It is part of the new way we grieve for the deceased.

This raises an interesting question. If people now going to have what amounts to a public funeral via social media, could they possibly plan for those funerals in the same way they now plan for their more traditional funerals?

In some ways they already can. For example, people can now designate a legacy contact for their Facebook accounts. Who knows, in the future people may designate a Twitter hashtag they would like used for expressions of grief.

The Internet has not just changed how we grieve over death. It has also changed how we should plan for our estates. 

Detailing how our digital accounts should be handled after we pass away is an increasingly vital part of estate planning. 

There are even services that allow for the digital storage of our estate plans and for turning over passwords to our digital accounts to a designated person after we pass away.

Reference: MIT Technology Review (Jan. 21, 2016) "The Internet Has Changed How We Deal with Death"

 

Managing the Digital Assets of the Deceased

According to a recent Philly.com article, “Social Media After Death,” in many instances, management of social media accounts after an individual passes away are handled by the executor; digital assets are part of the estate, and they should be treated like other assets by the executor.

Depending on where you live, the issue of digital asset management may also be further complicated. Right now there are 19 states that have laws on the books that protect digital assets and state how they are to be handled after you die.

In addition, there are some advocates trying to standardize the manner in which digital assets are handled across the states. The Uniform Law Commission (UFC) is working on this, but until this legislation is adopted, the article suggests that you talk with an estate planning attorney. He or she will have the latest information of how a deceased’s digital assets are handled in your own state.

Reference: Philly.com (July 24, 2015) “Social Media After Death”

 

Facebook Denies Account Access to Grieving Mother

Louise Palmer's daughter, Becky, loved sharing with friends and family on Facebook. It was Becky's way of keeping in touch with her loved ones and letting them know what was going on. However, when 19-year-old Becky was diagnosed with a brain tumor, she could no longer maintain her Facebook page on her own. 

Instead, Louise helped her and together the two of them used Becky's account to let people know how she was doing. After Becky passed away, Louise continued to access the account to read what people had to say about Becky and how they spoke with her in private communication. 

Louise found it comforting and it reassured her that her daughter would not be forgotten. 

Unfortunately, Facebook memorialized the account without notice. They made it so that Becky's account could not be accessed publicly and that no one could make changes to the account. 

Louise was locked out without warning. 

All of the precious memories that comforted her were denied to her. BBC News has more on this story in a story titled "How do we protect our digital legacy after death?"

This is becoming an increasing problem for grieving families. 

The issue is not just isolated to Facebook. Other social media companies do similar things after an account holder passes away. It highlights the need for options if you want your family to be able to access your social media after you pass away. 

In the end, you really need to engage an experienced estate planning attorney who can help you navigate the applicable laws and specific policies of the various technology companies.

Reference: BBC News (April 6, 2015) "How do we protect our digital legacy after death?"