Importance of digital assets in an estate plan
Arizona estate planning lawyers explain what you need to know about online assets
Whether it’s creating a last will and testament or a legal document granting someone the power of attorney, estate planning can and should be an essential part of anyone’s long-term financial plans. Most estate plans take into account a person’s property, such as their house or other physical possessions. As more parts of our society become digitized and go online, it’s important for individuals to consider all their assets when creating an estate plan. Increasingly, that includes “digital assets.”
What are digital assets and why are they so important? Why do they need to be protected and what laws exist to protect someone’s digital assets? Below, you can find the answers to these questions and many more from the trusted Arizona estate planning attorneys at the Law Firm of Brown & Jensen.
What are digital assets?
As the name suggests, digital assets can include anything that exists online or that is stored online in a digital format. This can include electronic records, such as emails, digital photos and social medial accounts. Digital assets can also include electronic assets that have a tangible financial value, including:
- Online bank accounts
- Online investment accounts
- Funds in a digital account (including PayPal)
- Cryptocurrencies (including Bitcoin)
- Credit card rewards
- Digital copyrights
- Digital trademarks
- Income-generating blogs
- Income-generating websites
- Digital music or media accounts (including Apple iTunes, Amazon music or movies)
- Frequent flyer miles
This is just a small sampling of digital assets. There are many other types of online assets that have a tangible value. That’s why it’s important to include them in any comprehensive estate plan.
Why is it important to include digital assets in an estate plan?
If you do not include digital assets in an estate plan, they may be passed onto the beneficiaries listed in your will, but there’s no guarantee. In addition, certain digital assets – including domain names for websites or digital assets with copyright agreements – might not be passed on to your intended beneficiary depending on licensing agreements and other legal matters.
In addition, it’s important to understand that only certain digital assets can be passed onto someone else through a last will and testament. Specifically, you can only pass on to someone else digital assets that have a tangible monetary value. Items you cannot pass onto someone else in your last will and testament can include email accounts, social media accounts and other digital assets that have no tangible monetary value.
Even so, your estate plan can include digital assets with no tangible monetary value. That way, you can make sure your wishes are followed after your death. An experienced estate planning attorney can discuss these matters with you.
What laws protect digital assets?
Several existing laws govern digital assets, many of which are designed to protect people from cybercrime, including:
- Computer Fraud and Abuse Act (CFAA) – This law protects digital accounts from being intentionally accessed without authorization.
- Stored Communications Act (SCA) – This law prohibits access of electronic communication (emails, text messages, etc.) without authorization.
- Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) – This law, which exists in 48 states, including Arizona, grants fiduciaries (powers of attorneys, executors, guardians, trustees, etc.) access to a client’s digital assets upon their death or if the client becomes incapacitated.
Without these laws, some digital assets may be unclaimed or unmonitored by their rightful owners and could be vulnerable to online cybercrime.
Learn more about your legal rights. Talk to an estate planning attorney.
Don’t underestimate the complexity of the legal issues involving digital assets. Make sure you consult with an experienced estate planning attorney who thoroughly understands the rules and regulations governing digital assets in your state.
In Arizona, Brown & Jensen can answer any questions you might have and help you every step of the way throughout the legal process. Contact our law firm and schedule appointment today. We have offices in Mesa, Tucson and Scottsdale.