New laws: The Access to Digital Assets Act
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Dear Mr. Premack: The Express News had a great run down of big new laws that impact us, like the new law banning texting while driving. I know that the Legislature must have passed other laws that are less well known but important. Can you give us your overview of new laws that might affect our estate planning and elder law concerns? – R.T.
Many of the new laws that were passed earlier this year go into effect on September 1st. There are indeed a number of opportunities and strictures provided in these new laws. Today, I will write about the new “Revised Uniform Fiduciary Access to Digital Assets Act (ADAA)”. This law has an impact on Wills, on Durable Powers of Attorney, on Trusts and even on Guardianships. Whenever the owner of a Digital Asset becomes incapacitated (or dies) those Digital Assets continue to have value and to need management. ADAA is designed to give, for the first time in Texas, legal tools to the Agents, Trustees, Executors, and Guardians that enable them to access and control Digital Assets.
Texas is not the first to enact this law. Already, 34 other states have passed ADAA with minor variations (that is why it is referred to as a “uniform” law).
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Digital Assets are given a legal definition in ADAA: “an electronic record in which an individual has a right or interest.” However, the electronic record does not include an underlying asset unless that asset is itself an electronic record. For example, bank statements tracking a bank account would be Digital Assets, but the money in the account is not a Digital Asset. Thus, in a Durable Power of Attorney, you might grant the Agent access to your Digital Assets (so the Agent can log into your online account and view records) but that grant does not include the right to withdraw funds. The Durable Power of Attorney would need other wording to authorize the Agent to actually control the funds in the account.
Before ADAA, when a person died the Executor would often struggle to get data for reports to the heirs if all of the accounts were handled online. Before ADAA, Facebook might refuse to release to the Executors various photos posted in the Decedent’s account. Before ADAA, a Trustee may have found it challenging to access records from a brokerage on investments now held in trust.
Many of us own valuable Digital Assets that we forget to consider. How many of you have an email account? Have you set up a website for your business? Do you buy books from Amazon to read on your Kindle, or music from the iTunes store to listen to on your iPhone? Those are all digital assets which could be lost without proper planning.
ADAA is limited in a variety of ways. For instance, if you have a Twitter account and often post comments, ADAA will allow your Agent or Executor to access the tweets, keep copies of them, and even to delete the account. But it will not give the right to make new tweets for you, to update account settings, or to delete specific tweets. For that reason, you attorney should be writing your legal documents to go beyond the basic activities allowed by ADAA. For instance, the Agent could be granted the right to update your website, to change settings on your Gmail, or to access passwords you have stored in a cloud account.
Next column we will look at a new law that allows new options for transferring title on your automobile which could keep the car in the family when you die instead of having it taken by the government.
Paul Premack is a Certified Elder Law Attorney with offices in San Antonio and Seattle, handling Wills and Trusts, Probate, and Business Entity issues. View past legal columns or submit free questions on legal issues via www.TexasEstateandProbate.com or www.Premack.com.
Dear Mr. Premack: The Express News had a great run down of big new laws that impact us, like the new law banning texting while driving. I know that the Legislature must have passed other laws that are less well known but important. Can you give us your overview of new laws that might affect our estate planning and elder law concerns? – R.T.
Many of the new laws that were passed earlier this year go into effect on September 1st. There are indeed a number of opportunities and strictures provided in these new laws. Today, I will write about the new “Revised Uniform Fiduciary Access to Digital Assets Act (ADAA)”. This law has an impact on Wills, on Durable Powers of Attorney, on Trusts and even on Guardianships. Whenever the owner of a Digital Asset becomes incapacitated (or dies) those Digital Assets continue to have value and to need management. ADAA is designed to give, for the first time in Texas, legal tools to the Agents, Trustees, Executors, and Guardians that enable them to access and control Digital Assets.
Texas is not the first to enact this law. Already, 34 other states have passed ADAA with minor variations (that is why it is referred to as a “uniform” law).
Lifestyle Channel
Digital Assets are given a legal definition in ADAA: “an electronic record in which an individual has a right or interest.” However, the electronic record does not include an underlying asset unless that asset is itself an electronic record. For example, bank statements tracking a bank account would be Digital Assets, but the money in the account is not a Digital Asset. Thus, in a Durable Power of Attorney, you might grant the Agent access to your Digital Assets (so the Agent can log into your online account and view records) but that grant does not include the right to withdraw funds. The Durable Power of Attorney would need other wording to authorize the Agent to actually control the funds in the account.
Before ADAA, when a person died the Executor would often struggle to get data for reports to the heirs if all of the accounts were handled online. Before ADAA, Facebook might refuse to release to the Executors various photos posted in the Decedent’s account. Before ADAA, a Trustee may have found it challenging to access records from a brokerage on investments now held in trust.
Many of us own valuable Digital Assets that we forget to consider. How many of you have an email account? Have you set up a website for your business? Do you buy books from Amazon to read on your Kindle, or music from the iTunes store to listen to on your iPhone? Those are all digital assets which could be lost without proper planning.
ADAA is limited in a variety of ways. For instance, if you have a Twitter account and often post comments, ADAA will allow your Agent or Executor to access the tweets, keep copies of them, and even to delete the account. But it will not give the right to make new tweets for you, to update account settings, or to delete specific tweets. For that reason, you attorney should be writing your legal documents to go beyond the basic activities allowed by ADAA. For instance, the Agent could be granted the right to update your website, to change settings on your Gmail, or to access passwords you have stored in a cloud account.
Next column we will look at a new law that allows new options for transferring title on your automobile which could keep the car in the family when you die instead of having it taken by the government.
Paul Premack is a Certified Elder Law Attorney with offices in San Antonio and Seattle, handling Wills and Trusts, Probate, and Business Entity issues. View past legal columns or submit free questions on legal issues via www.TexasEstateandProbate.com or www.Premack.com.
