As our world becomes more virtual, so do the assets we own. Therefore, when making an estate plan, it is important not to overlook the digital assets you own as well. These assets include intellectual property, social media profiles, emails, credit card points, smartphones, or online storage and hardware. Most of these are locked using a password that only you know, so planning who will be able to gain access in the future is important.
In 2016, Governor Cuomo signed into law amendments to the New York Estates Powers and Trusts Law regarding the administration of digital assets. The amendments provide personal representatives “power over decedent accounts on social networking websites, micro-blogging or short message service websites or email service websites.” This creates a default plan for such assets, but as with any distribution in estate planning, the default plan is not always the way the decedent wants their assets distributed.
The assets are broken down into three main categories: personal digital property with monetary value, personal digital property, and digital business property.
Personal Digital Property with Monetary Value
Personal digital property with a monetary value includes computing hardware, smartphones, tablets, digital cameras and other devices that have a value. It also includes accounts that are used to manage money and hold money or credits such as online bank accounts, PayPal accounts, loyalty rewards, and any accounts with a credit balance.
Personal Digital Property
Personal Digital Property include the information that is stored electronically. This includes any data that is stored online, in a cloud, or on a physical device. The category also includes online accounts such as emails, social media accounts, photo and video sharing, shopping accounts, and any websites or blogs you may control.
Digital Business Property
Digital business property deals with any online accounts registered to a business. This includes any digital property that is owned by a business organization. Additionally, it includes any assets of an online store you manage such as on Amazon or eBay. Any client information or customer history is also included in digital business property.
The next step is to pull together all logins and passwords. When doing so, it is often important to think if the particular information would be useful to a particular person after death. Also consider what would happen if the information were to vanish all together. Let’s imagine an individual with all of their family photos stored on their cloud with a password that only they know. Without planning for these in your estate, your family will be losing irreplaceable photos. How about paying your bills through an online account? A failure to take account of your digital assets can result in the shutting off of water or power to your home. Taking the steps to protect these assets is important to assure your estate is distributed properly.
It is not safe to believe that the service providers will disclose the information to your family members or business partners because there are federal laws that prevent them from doing so. Instead, it is recommended that you name a digital executor or trustee. While selecting the same executor or trustee for your traditional assets may seem like a good idea, you should probably make sure that they are tech savvy.
Lastly, compile the list of the digital assets, logins, and your wishes for each piece of digital property. Like a will, these documents should be stored securely, but still accessible. Furthermore, you should update your will to incorporate the digital asset plan and the location of the access instructions. Like any other estate plan, your digital asset estate plan should be updated regularly.
If you are in the process of estate planning, an experienced attorney can provide you with the legal guidance necessary to help plan for your family and loved one’s futures. From the simple to complex, the attorneys at Blodnick, Fazio & Associates are skilled in all aspects of estate planning and are dedicated to representing its clients with diligence and compassion. With an office conveniently located in Garden City, Nassau County, the firm is dedicated to providing high quality legal representation at reasonable prices. Call (516) 280-7105 to arrange a free consultation.