What Happens to Your Digital Assets After You Die?
Nowadays almost everyone has digital assets. In fact, you might not even be aware of how many you possess. Do you own digital currencies? Do you keep business records online? Do you keep money in an online bank account such as PayPal? Almost everyone will answer yes to at least one of these or similar questions.
The Uniform Fiduciary Access to Digital Assets Act
On January 1, 2017, the Uniform Fiduciary Access to Digital Assets Act (the “UFADA”) went into effect in California. This law solves a lot of problems by allowing you to grant partial or complete access to your digital assets to an executor, administrator, trustee, or other fiduciary upon your death or incapacity. You can also deny access to particular parties in whole or in part.
Your instructions regarding your digital assets must be in writing:
Instructions that you issued using an online digital assets management tool will prevail over all contrary instructions, including will, trusts, powers of attorney, other written instruments, account user agreements, etc.;
Instructions that you provide in a will, trust, power of attorney or other written instrument will prevail over account user agreements, but will not prevail over instructions that you issued using an online digital assets management tool.
The terms of account user agreements will prevail only if you have not provided contrary instructions via any of the above-listed methods (will, trust, power of attorney, written instrument, online digital assets management tool, etc.).
In addition to granting access, you can deny access, in whole or in part, to particular people under the same rules as stated above.
What Could Happen: The Worst-Case Scenario
Without a digital assets plan, your beneficiaries could be denied access to your digital assets (the contents of an online bank account for example), or your caretaker could be denied access after you become incapacitated and cannot remember your passwords.
Without contrary instructions, the terms of your various user agreements will prevail. These agreements will likely be inconsistent with each other. You might need a separate court order for each of these agreements to gain full access to your digital assets. Legal fees could exceed the value of the assets. It’s a mess you and your estate beneficiaries don’t need.
It is Absolutely Critical That You Incorporate Your Digital Assets Into Your Estate Plan
Contact an experienced California estate planning attorney to help you inventory your digital assets, list them in a clear format for third-party access, and list your usernames and passwords in a single secure location (a safe deposit box, for example).
Your attorney can also help you prepare advantageous and consistent instructions for you to issue using an online digital assets management tool as well as traditional legal documents such as your will, a trust document, a power of attorney, etc. Your attorney can also help you keep your digital estate plan up to date as the law changes.
Contact Masumi Patel for Help Incorporating Your Digital Assets into Your Estate Plan
Many potential pitfalls await those who attempt to incorporate their digital assets into their estate plan. You are going to need an experienced California estate planning attorney to avoid nasty surprises down the road (some of which you may not even live to see). Contact the Law Office of Masumi Patel as soon as possible to schedule a consultation. Let’s explore your options together.