Who gets control of your selfies when you die? Who can be entrusted with deleting your problematic tweets when you kick the bucket? Who gets access to your Facebook account? Well, the law is murky, but a bill flying through the state Legislature would clarify the matter in Florida.
State Sen. Dorothy L. Hukill’s SB 494 would allow people to clarify who can have access to their digital accounts once they pass on. It would allow Floridians, either through a will or an online tool, to specify who gets control of their internet accounts. The terms of service of many online services specify that only the original creator of the account can access it, with no exceptions.
Social media sites’ policies on what to do with an account after a user passes can vary greatly.
A similar bill failed to pass last year after internet service providers feared it would violate their users’ privacy. The newly revised bill eases those concerns by requiring people to specifically leave instructions behind.
The bill can be applied to everything from social media accounts like Twitter and Instagram to email and online bank accounts. People would also be able to spell out exactly what the custodians of their accounts are allowed to do with the information.
Hukill, in her private sector job, is an attorney specializing in estate planning. Eight other states have passed similar bills.
Today the bill passed unanimously in the Senate, 36-0. A House version has passed three committees without much opposition and has been placed on the calendar to be voted on by the entire House.
Since 2003, we have seen a significant shift in how our information is stored, delivered, and used. In the past I used to advise clients to look in the mailbox for bills and statements to locate the assets of a deceased loved one. Now, in 2016, the mailbox is electronic and the bills, statements, and other notifications are getting to be all digital. We are seeing our lives transitioning to the internet “cloud” every day. Regardless of how much we like it, or how comfortable we are with it, our lives tomorrow will be different that they are today.
This evolution in how we do what we do is causing, for some of us, a disconnect in how we see our world. What used to be obvious is now more subtle; what used to be challenging is now easier. And because of these changes, we take so much more for granted. Those pictures taken of uncle bob and his kids on Instagram; the documents received from a colleague stored on Dropbox; the credit card bill from Netflix; the invoice of your personal items from Amazon; the profile of you on LinkedIn; remember that payment via bitcoin or PayPal?; and don’t forget your timeline on Facebook. The technological changes we have been experiencing have enabled us to leave an imprint of our lives online in so many ways. And whilst this is nice and it certainly is easy, the question that few are looking at is what happens to these digital ghosts of our lives after we have passed away?
Last year, in 2015, there were approximately 83 million Americans who had atleast one of their online accounts hacked if we look at just the top four hacks of the year. About 80% of all people who pass away in the United States have online accounts of one sort. As time goes on, that number will only increase, as the Gallup pollclearly shows. Of course, the more we go online, the greater the threats from hacks, ID theft, misappropriation of information, and con-artists absconding with ill-gotten funds. One personal anecdote I can share is that of a childhood friend of mine who passed away leaving behind an infant daughter. A miscreant posted on her Facebook page a link to have the friends and family donate money for a “charity” for the benefit of the child. After a time, those funds were collected and the person disappeared into the ether. This is just one case of many where people are abused during a time of emotional stress.
Several challenges face those survivors acting as representatives of the deceased when it comes to closing or accessing the still active accounts of the deceased. First, identifying the active accounts may be an issue if no inventory is left in place. Second, the representative has to have the time to navigate the web sites of these accounts to even determine who to contact or what form to complete so that the account can be closed. Sometimes these accounts may need to be accessed rather than closed, and that’s another significant matter that will be discussed below. Third, not every online account will require the same information to close such the account. For example, while Facebook may simply require proof that the person seeking to close an account is an immediate family member, LinkedIn requires the member’s name, your relationship to them, the company they worked for, a link to the profile, and the member’s email address; just to cite two examples.
As the internet ages with us, a critical mass is developing in the legal community and state legislatures to better help the representatives of the deceased to handle these online accounts. A national framework called the Revised Uniform Access to Digital Assets Act (RUFADDA) has been drafted to enable access and closure to these accounts. The difficult path that lies ahead is in having all states enact laws within their own legislatures that will ratify the RUFADDA. At present about 54% of the states have begun the process of introducing legislation dealing with this. Florida is set to put into law it’s version this July. We can’t forget though that while the United States created the internet, it is worldwide, as are people’s accounts. So while our nation is slowly making strides, many online providers have no process or legal structures in place to allow for the living to handle their loved one’s accounts.
Further, and as I alluded to earlier, there is a bright line that cannot be crossed when dealing with the accounts. Accessing an account requires prior consent from the account owner. When was the last time you completed a form allowing your representative to access your email account. Most likely, the answer is “never.” Here, the Stored Communications Act (SCA) and the Federal Computer Fraud and Abuse Act (FCFAA), actively prevent any unauthorized person from accessing such accounts. Doing so opens the door for civil and criminal penalties against the online account provider and yourself, if you were to access your loved one’s email, for example.
When examining the upcoming legal structure of the states’ work, it is very important to understand that the deceased’s digital assets are exactly that – assets. They must be dealt with in the same way a person’s other assets are handled, and that is by using a durable power of attorney or guardianship while a person is alive, but incapacitated, and through a person’s Last Will or Trust when deceased. This will necessitate a court supervised administration of the estate to deal with the digital estate even if a person had no others financial assets to speak of.
There are things that can be done. First and foremost, speak to an attorney who is versed in digital estate management and who has the understanding and capability to ensure your legal estate documents are up to the future task of providing the prior consent required. Next, work with certain online companies like EstatePass.com to safeguard your information while living and will ensure your and your future representative’s legal rights are protected by having the prior consent on file, or if dealing with the accounts of a deceased loved one, EstatePass.com will provide a simple online tool to help you close the necessary accounts. Remember: simply having a list of accounts and passwords does not protect your rights or give a representative the authority to access these accounts.
Even though John is a lawyer, he is probably not your lawyer (if he is, then that’s cool!), so before you decide to take action based on the information presented in this post, it is recommended that you first consult with your own attorney.
I, of course, am not a lawyer.
Cheers, and here’s John:
Pat recently wrote a post on The Dark Side of Successful Blogging in which he explained the many negatives he has had to deal with as SPI has experienced explosive growth over the past less than three years.
Just like any successful business, successful bloggers experience growing pains as they begin to gain a following. Usually success means outgrowing an original hosting provider or email marketing provider, as well as countless themes, plugins, affiliates, and maybe even phone systems or office space.
What successful bloggers usually don’t realize as they are building a following and watching their income grow each day is that along the way, they’ve built some major assets which need guarding and protection. The domain, the blog itself, the brand, even a Twitter account with substantial followers can all quickly become extremely valuable assets. And on the list of “to do” items, I’m willing to bet that setting up legal protections to guard blog assets falls pretty far down on the list.
If you haven’t already, you should be thinking now about how you can legally protect yourself and the valuable assets you have created.
You could be sued by an affiliate who claims they are owed thousands in unpaid commissions, or by another blogger who claims you stole their “idea.” No matter the dispute, if you leave yourself exposed, your hard work could go down in flames.
You wouldn’t buy a $100,000 condo without really protecting yourself from losing it (such as by purchasing insurance), yet some bloggers build a $100,000 blog without building adequate protections. Personally, I think that’s nuts.
Of course, every blogger’s life situation is different, and the laws will be different depending on where you live. But there are certain similarities and principles which are universal when it comes to setting up a legal structure to protect your interests wherever you live.
You will also need to decide when your growth is significant enough to justify the significant contribution of time, energy and money to separate all of the business of your blog into a new separate legal entity.
How to Form a Legal Business for Your Blog
The first step is you should form a separate legal entity, owned by you, which “houses” all of your blog’s assets. Every state and country has different laws and names for this particular legal entity, but in California, where I practice law, the best entity is a Limited Liability Company (LLC). The LLC may go by another name depending on where you live.
A LLC is a highly flexible and customizable legal entity that gives you the peace of mind of knowing you are protecting your assets without throwing up burdensome legal barriers and maintenance requirements. A LLC is generally easier to set up, cheaper, and more flexible with fewer formal requirements than a corporation. On the other hand, a corporation does have certain advantages, namely that it can take on investors (shareholders) who have limited liability for the corporation’s debts or actions. In most cases, the advantages of forming a corporation are outweighed by the increased burdens which corporate formalities bring — especially given that most bloggers don’t need to bring on investors.
If you have business partners for your blog, then you will also need to prepare an Operating Agreement. The Operating Agreement spells out the nuts and bolts of the business; it is the “Constitution” which guides the business.
If one of you is going to handle 90% of the writing and the other is going to handle 100% of the affiliate programs but you’re going to split the profits 50/50, then you should put that in the Operating Agreement.
If you are a single blogger and don’t have any partners for your LLC, then you do not absolutely have to have an Operating Agreement. However, if you have one or more partner, you should definitely have an Operating Agreement, and I recommend you spend some time hammering out the details. Although companies like LegalZoom will provide you with a boilerplate Operating Agreement, you and your partners should consider customizing it or hiring an attorney to do so.
Use the Legal Entity For All Business Matters
The second step is you need to use the legal entity of your choice religiously for transacting all business related to your blog. Simply creating the LLC doesn’t waive a magic wand which will protect you and your assets from any harm.
The number one problem with LLCs isn’t that people don’t set up a LLC to begin with; it’s that people set up an LLC and then don’t use it. They commingle their business funds with their personal funds in one checking account. They don’t sign contracts in the name of the LLC. They don’t purchase goods in the name of the LLC.
They might as well have never formed the LLC, because the LLC can’t protect you from liability if you use your own personal name to conduct business.
It’s like buying a bulletproof vest and then leaving it hung up in your closet. It can’t do you any good unless you use it.
You need to transfer all blog business-related assets like domain names and hosting accounts into the name of the LLC. The new legal entity will become the actual owner of the blog, but don’t worry – you will own the LLC so it won’t change your income or ownership rights. Your affiliate and sales income is treated the same way as it was previously – it is passed through to you.
You can change your domain name’s ownership registration with whoever you used to register your domain.
The next step is to set up a separate bank account in the name of the LLC. One of the most common problems with small business owners is that they commingle personal assets and business assets in one shared bank account. When you do that, you put yourself at risk that the LLC will be treated as if it was not a separate legal entity.
To avoid this problem, you should open a separate bank account in the name of the LLC and use it exclusively to pay bills such as for your hosting provider and to receive affiliate income and/or sales income. You can then transfer the funds from the LLC’s account to your own personal account.
This extra step is crucial if you want to keep the LLC treated as a separate legal entity. If the blog is later sued for whatever reason, and you did commingle funds, your other personal assets could be at risk because a court might treat the LLC as just an extension of you personally.
Get a Federal Tax Identification Number (EIN)
If you are a resident of the U.S., the next step is to get yourself a state and federal Employer Identification Number (EIN). You can get your EIN electronically directly on the IRS website.
Set Aside Enough Money for Taxes
Finally, don’t forget to set aside enough money for taxes. Because LLCs pass through all income to its owners, it is the owner’s responsibility to pay income tax.
I hope the above tips don’t take too much of the “fun” out of building a successful blog, but I believe it’s much better to take a few hours to get all legal matters in order than to pay the consequences in the long run.
These are among thousands of emotional, humorous, sometimes snarky requests inserted into published obituaries, attributed to the deceased or their families. And though complete strangers have always been among the audiences for messages from beyond the grave, digital death notices mean they now reach far beyond family and friends to people around the world.
“It takes just one funny, unusual or touching line for an obituary to go viral,” said Katie Falzone, director of operations for Legacy.com, which compiles and archives death notices.
That was the case last month after the death of staunch Republican Larry Upright of Kannapolis, North Carolina, whose obituary ended with the line: “The family respectfully asks that you do not vote for Hillary Clinton in 2016. R.I.P. Grandaddy.”
That bit of stumping won national attention and all kinds of comments on the funeral home’s website and on social media. News accounts were tweeted, retweeted and referenced on Facebook and viewed on YouTube tens of thousands of times.
“We got some sweet responses and we got some nasty responses,” said Upright’s wife, Colleen. “But we’re Uprights, and that just rolls off our backs.”
There have been other politics-oriented dying requests in recent years: to vote for George W. Bush and to support his removal from office; to donate to President Barack Obama and to support “anyone but Obama”; to vote Democratic and to support the tea party.
After 24-year-old Molly Parks of Manchester, New Hampshire, died last month from a heroin overdose, her obituary also spread through cyberspace, fueled by the brokenhearted pleas of her father.
“If you have any loved ones who are fighting addiction, Molly’s family asks that you do everything possible to be supportive, and guide them to rehabilitation before it is too late,” he wrote.
Most of the requests from the dead have to do with the ceremonies of death.
Bob Harrar of Orlando, Florida, who died in December, put these instructions into his obit: “Make sure you don’t give my ashes to my mother. She’ll put them in a drawer with my grandparents.”
Milton Miller of Little Rock, Arkansas, left word that anyone feeling sad about his passing should “mix a beverage of your choice and hum the Razorback fight song.”
Garland Babcock of Anchorage, Alaska, left very specific instructions to have his ashes “put in an old trucker’s Thermos and driven in a red Chevy truck to Monterey Bay, California.”
And the obituary for Larry Sajko of Port Richey, Fla., said, “Larry requests no cellphones at his service.”
When Christian “Lou” Hacker died last month in Valatie, New York, his obituary said he left behind “a hell of a lot of stuff his wife and daughter have no idea what to do with.”
So they told readers, “If you’re looking for car parts for a Toyota, BMW, Triumph, Dodge or Ford between the years of about 1953-2013, or maybe half a dozen circular saws, still in their boxes with the Home Depot receipts attached, you should wait the appropriate amount of time and get in touch.”
Hacker’s wife, Mina, said this past week that the invitation was “mostly a joke and no one has taken us up on it.”
“Actually, it will take us a while to decide what to do,” she said. “Everything is attached to a memory.”
When “in lieu of flowers” appears in an obituary, it typically requests donations to a favorite charity of the deceased.
But it’s also been attached to a variety of strange requests.
“In lieu of flowers, tune up your car and check the air pressure in your tires — he would have wanted that,” read the 2011 obituary for B.H. Spratt of Ponte Vedra Beach, Fla.
“In lieu of flowers, the family asks that if you smoke, try quitting at least one more time.”
“In lieu of flowers, if you knew ‘Bud,’ he would want you to mix yourself a Manhattan.”
“In lieu of flowers, buy a lottery ticket. You might be lucky.”
Thomas Taylor of Durham, N.C., was apparently hoping to get some money back after his death. Taylor died in 2008, nine years after making his funeral arrangements.
His obituary said one of Taylor’s last requests “was to contact the Cremation Society to ask for a refund because he knew he weighed at least 20 percent less than when he paid for his arrangements.”
AP news researcher Rhonda Shafner contributed to this report.
Consider for a moment how much your daily activities have an online component? From banking and bill paying to multiple email accounts – if something were to happen to you tomorrow, would your fiduciary have the necessary access to handle your password-protected and often encrypted digital life?
What exactly does this term “digital assets” entail and how is it relevant to estate planning? As technology has become embedded in most aspects of our daily lives, you may be hard pressed to think of someone who does not have at least some online presence and/or digital property. The term encompasses email, social media and other online accounts; digital photos, downloaded music and other files stored on the cloud. It also entails valuable content stored on personal devices and, maybe even in some cases, blog content and valuable domain names. Essentially, the term “digital assets” refers to intangible assets with sentimental value and perhaps even financial value.
Current & Proposed Law
The disjointed laws around fiduciary access to digital assets further muddy this already cloudy area of estate planning. Understandably, laws in this area have not kept pace with technology and its ever-increasing role in our daily lives. Privacy, copyright and intellectual property laws intersect with federal and state law on the matter resulting in confusion as to legal authority over a decedent’s digital assets. While a handful of states have passed some clarifying laws, the governing law in most cases dates back to 1986 regulations on unauthorized access of computer hardware and stored devices. Certainly these lawmakers could not have imagined how integrated our digital and daily lives would become. Furthermore, procedures for handling decedents’ accounts are often addressed in individual provider Terms of Service agreements and can vary dramatically by provider. As we hurriedly click through and accept new terms of service, do we have any idea what will happen to our email or social media accounts upon our deaths?
To rectify the situation, a national committee of attorneys appointed by the Uniform Law Commission is currently drafting proposed legislation to be known as the Fiduciary Access to Digital Assets Act. The primary purpose of the Act will be to grant fiduciaries (executors, trustees and agents under power of attorney) the power “to access, manage, distribute, copy, or delete digital assets and accounts.” The committee is attempting to work through the inherent difficulties in balancing the effectiveness of the Act from a practical perspective while respecting constitutional privacy laws.
How Does It Impact Me?
In the meantime, what should we do? First, identify your digital assets. Some experts recommend storing this “inventory” in an encrypted file with instructions for accessing the file kept securely with your original estate documents or in a safe box. Second, think about access to these assets after you are gone. Do you want your executor to be able to access your personal accounts? Would having access to your online accounts provide ease of administering your estate? Would your family and close friends find comfort in accessing your online photo archives? Some companies have begun offering digital “afterlife” services such as EstateAssist.com, the Legacy Locker and Data Inheritance. In spite of the possibility of inherent security and viability risks with such providers, they may offer a better alternative to the often out-of-date and unsecured password sheet many keep in their desks. Another alternative, if utilizing a password manager program such as Dashlane for PCs or 1Password for MACs, is to keep log on credentials to your password manager in a safe box. Additionally, many attorneys advise specifically granting your fiduciary the right to manage – access, control and delete – digital assets in estate planning documents. These steps may not be a panacea until the laws evolve; but they’re likely to increase ease of estate administration while also demonstrating testator intent with regard to these assets.
With access, a fiduciary will be able to more effectively distribute, memorialize or eliminate the digital assets as appropriate. In some cases, eliminating accounts can be an important deterrent for identity theft. Sadly, it is not beyond identity thieves to exploit the identities of the deceased.
The importance of planning for digital assets will only continue to grow as our reliance on technology increases. As with most estate planning, the most effective approach is to plan ahead. If you are interested in additional practical information on this topic, we recommend Your Digital Afterlife by Evan Carroll & John Romano.
It is worth noting that even where estate documents grant fiduciary access to electronic and stored communications, the fiduciary may still be in violation of privacy and fraud prevention laws as well as individual terms of service agreements until more current laws are enacted. However, there are no reported cases of the Department of Justice or a state prosecuting a fiduciary for unauthorized access to a deceased or disabled’s digital access. Nonetheless, the threat of criminal penalty does exist and experts predict it’s an issue that may end up in the courts.
Carter, “Pixar for Estate Planners,” ACTEC Presentation to the Wake County Estate Planning Council, November 2014
Bissett & Kauffman, “Surf the Evolving Web of Laws Affecting Digital Assets,” 41 Estate Planning Journal 4, April 2014
Prangley, Haller & Coventry, “Web of Estate Planning Considerations for Digital Assets,” 40 Estate Planning Journal 5, May 2013
Jennifer Jones is a Trust & Estate Advisor at TrueWealth, LLC, a wealth management firm located in Atlanta. She has over 13 years of experience in tax and planning, combined with experience in trust administration. She can be reached at firstname.lastname@example.org or 404.487.0518.
This communication is not intended as accounting, tax or legal advice and is not a substitute for an opinion from your tax and legal advisor on specific issues applicable to you. Please consult with your CPA for specific guidance on your personal planning and an attorney for legal advice. You may elect unilaterally to follow or ignore completely, or in any part, any information, recommendation, or advice given by TrueWealth Management and its affiliates.