What our Estate Planning Clients Need To Know - What are Digital Assets?

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The purpose of this post and is to bring you, our clients, information about a type of ‘asset’ most of you own.  These assets are called Digital Assets, which include any electronically-stored accounts, information and data.

This is an emerging area of our lives, and is also a fast-changing area of the law. Attorneys and other estate planning professionals are not only working to educate our clients about the presence of these assets, but are also working to make sure that upon disability or even death, agents, executors and trustees will be able to access and maintain those accounts in accordance with our clients’ wishes. Due to the interrelation and tension between laws authorizing access to digital assets and those prohibiting it, with the justifiable goal of maintaining privacy and protecting computer information from security breaches and theft, this can be a challenging process if clients do not maintain adequate records of their digital assets.

Over the course of the next four weeks, I will address some of the basic issues concerning access to Digital Assets and passage of those assets at death.

What are Digital Assets?
Accounts, information and documents that are stored electronically on a personal computer, on a device, such as a smart phone or tablet, or in the cloud, are considered Digital Assets. When working with clients on their estate plan, we ask them to think about the types of assets they have and how they gain access to those assets or accounts. We do this, so that if they were to become disabled or die, their agent or personal representative will be able to obtain access to those assets, if needed.

These types of assets include:

  1. Computers and their Content. Our computers hold a lot of our information, including documents, financial information, photos, and links to online content.
  2. Tablets and Smart Phones and their Content. Tablets (ex. iPad, Windows Surface, and Android system-based tablets) and smart phones contain much of the same information found on personal computers.
  3. Social Media. Social media accounts, such as Facebook, Twitter, LinkedIn, MySpace and hobby sites such as Pinterest.
  4. Photos and Video. Photos and videos, whether stored on the computer locally, or in the cloud, using a service such as Flickr, Shutterfly, and Instagram.
  5. Contact Lists (Address Books). What was kept in paper address books is now often maintained in electronic form.
  6. Calendars. Many of you maintain your work and home calendars in one or more electronic calendar programs. There are also apps that allow family or friend sharing of each other’s calendars.
  7. Online Accounts such as Amazon, iTunes, PayPal, Catalog Accounts and the like. Many of us have so many online purchasing accounts it would be difficult to list them all.
  8. Online Stores. Do you host an online store or sell items online on your own site or a site such as eBay, Etsy and Craigslist. It is important to know if you have any business or legal responsibility to fill orders or to deliver goods.
  9. Music. Music, stored locally on the computer or in the cloud. A customer may or may not own the music resident on your iTunes or Google Music.  If you download from iTunes, you are only ‘renting’ the music, and they are not transferable, even to your heirs or beneficiaries. If you buy a CD and upload the music to a computer into iTunes, only then is the music transferable. 
  10. YouTube. Do you post to YouTube? If so, do you know your username? More than 1 billion unique users visit YouTube each month and one hundred hours of video are uploaded every minute, resulting in nearly 16 years of content uploaded every day! More video is uploaded to YouTube in one month than the three major US networks created since their founding. 
  11. The Electronic Library, Amazon Kindle, iBooks, Barnes & Noble. Again, many of the eBooks purchased may not be legally transferable, even if you could figure out how to actually do it.  
  12. Gaming. These sites not only have individual information, but there is often value built up in some of the games.  
  13. Electronic Financial Accounts and Account Records. Many of us and many of our clients receive one or more statements from their financial institutions via electronic means. Additionally, most of our employee benefits are accessed via the internet. Beneficiary designations are often available electronically and may be submitted in that manner. The information in this category contains confidential information that may be protected by federal privacy laws. Finally, sites such as Quicken.com and mint.com contain online financial records.  
  14. Tax Returns. With the advent of Turbo Tax and other computer-generated tax programs, many tax return records are stored on personal computers or on the servers of the tax service. The information stored here is also protected information.  
  15. Electronic Medical Records. Also in the realm of protected information, this time as a result of medical privacy laws, are any electronic medical records. Many medical providers offer patients access to medical information via electronic media.  
  16. Documents Stored in the Cloud. The most popular app or website to hold documents, pictures, publications, and just about anything that can be electronically stored is Dropbox. Other similar apps or websites include Box.com, Evernote, Microsoft Onenote, Notability, and the photo and video sites listed above.  
  17. Emails. Emails take the place of what we used to call letters. An email system can be locally stored on a computer or server, such is the case in many businesses. Most personal email accounts are now stored on the email provider’s servers, as is the case with AOL, Gmail, Hotmail, Yahoo, and others.
  18. Blogs. Do you maintain a blog? Is it income producing? If something should happen to you, do you wish it to be maintained, archived, deleted or some other disposition?  
  19. Websites. If you maintain a website, the name of the registrar must be kept in a safe place. We need to know whether a website is income producing, whether it needs to be maintained, whether it has value to the owner or the owner’s estate. Do you own unused domain names?

Topics:  Digital Assets, Estate Planning

Published In: Science, Computers & Technology Updates, Wills, Trusts, & Estate Planning Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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