Digital estate planning tool Easeenet, in partnership with in-home care franchisor ComForCare, are supporting families by keeping them from getting locked out of their online lives. Digital estate planning means organizing digital property and assets, and arrangements for how things should be handled after death. As technology has advanced, […]
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The Handling of Digital Property in Estate Planning in Wisconsin
The Handling of Digital Property in Estate Planning in Wisconsin
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What is digital property?
Digital property consists of online accounts that are protected by a password and/or PIN (Personal Identification Number). Some accounts might have monetary value, and other accounts might be sentimental such as photo libraries. Many digital accounts have no value but would be considered an electronic record in which a person has a right or interest.
Examples of digital property are nearly endless but include:
- Online bank accounts (most of which require multi-step authentication processes to access)
- Online retirement accounts
- Data on your phone or other electronic devices
- Electronic bill payments
- Credit card accounts that are paperless
- Email accounts (which may include helpful communications and monthly reports from various other online accounts)
- Social media accounts like Facebook, Twitter, Instagram, and LinkedIn (plus many others)
- PayPal accounts
- eBay accounts
- Online shopping accounts with saved credit card information
- Photo libraries
- iTunes accounts and other music libraries (which might be licensed property, not owned)
- Cloud services
- Web domains, personal or professional websites
- Online memberships
- Home security systems
- Any accounts with automatic renewal or payments such as insurance policies, virus protection accounts, tuition payments to kids/grandkids schools, church contributions, other charitable contributions, newspapers, Sirius radio accounts, etc.
- Entertainment accounts like Netflix, Hulu, and online gaming accounts
- Healthcare online accounts like MyChart platforms
What happens to digital property after a person passes away?
Digital assets are handled similarly to other property after a person dies. Thus, if the deceased does not have a will, the rules of intestacy apply to digital property as they do for all estates without a will. A challenge with addressing digital property, however, is that survivors are frequently unaware of a deceased’s digital property, especially if there was no will.
In April 2016, the Wisconsin Digital Property Act was signed into law to aid in distributing assets that include digital property. In part, the Act helps personal representatives and fiduciaries gain access to the deceased’s digital property. It also helps courts and practitioners handle digital property similar to physical property.
If the deceased has a will, distribution of all assets should be clearer, including digital property.
To help with that clarity, when creating your will, be sure to incorporate your digital property and provide the following information, if possible:
- An updated and thorough inventory of all online accounts and passwords and what the account consists of
Many people create a document or spreadsheet that the lawyer and/or a named person has access to that lists your accounts and security information. If you choose to store all your accounts and passwords in one digital place, such as an app or somewhere on a device, make sure your will highlights where this information can be found, or let your lawyer know how to access it. It’s important that your online account information be updated regularly when passwords change or when accounts are added or deleted. Take note that access to your phone might be necessary for two-step authentication on some accounts.
It can be helpful to also indicate what the account consists of, such as “personal email” or “former employer pension” or “account linked to PayPal” — anything that provides helpful details about that account.
- A named digital property representative/digital executor
Choose one or more trusted persons to handle the digital property component of your will. You may want different people to handle different accounts. Ideally, these people have some level of technical expertise. At a minimum, your estate plan should allow the executor of your will to designate a person to handle digital property. (Keep in mind that access to an account does not mean that person is entitled to any value assigned to that account.)
- Specific plans for each account
Some online accounts, such as Facebook, have a process to follow when someone dies. In addition, some accounts allow you to choose someone to close or manage your account in your personal settings. Still, you should specify what you would like done with each account on your inventory list. Do you want some accounts closed, like social media or email? Do you want someone to take over an account, such as a photo library or ancestry profile? What do you want to do with financial/bank accounts that you earmarked for a child’s college tuition or to pay your property taxes? (Many banks and credit unions allow you to name each financial account for their intended use, such as “college” or “property tax,” which can be helpful.)
The most important thing is to identify as many accounts as possible, especially those with monetary value.
How can a lawyer help with digital property management — before and after death?
The Wisconsin Digital Property Act helps clarify the law regarding digital property to some extent, but the process of identifying and accessing that information in Wisconsin estate planning is still being fine-tuned.
While creating an inventory and designating people to manage digital accounts is the responsibility of the person who owns the estate, a lawyer can assist in a number of ways.
When making a will, an estate planning lawyer can help you by:
- Overseeing (be the keeper of) your online account information. Your lawyer should be updated when accounts are added or deleted or when passwords are changed. You can submit this information to him/her via email or hard copy updates. You could also give your lawyer information needed to gain access to the place where this information is kept, like an app on your phone.
- Keeping a key (but not the only key!) to a safe where you have documents with this information. At a minimum, you should tell your lawyer where the key is kept.
- Helping create a digital property document that explicitly names individuals who may access your accounts, including powers of attorney if you become incapacitated.
- Assisting in creating a trust to keep digital property out of the courts, if this seems necessary.
After death, a lawyer can assist with digital property by:
- Helping identify the accounts that need legal action to access.
- Making sure the information is in the right hands, as per instructions in the will.
- Working with the executor to sort out details.
- Representing loved ones who work to gain access to digital property or who want to ensure that access requests are legitimate.
- Remaining objective about information discovered in any digital accounts and focus on the legal issues specifically.
- Providing assistance with probate matters or with intestate matters, if there was no will.
- Advising clients on processes of recovering and dividing digital and other assets.
Planning for digital property, in summary
The days of waiting for bank/financial statements and bills to arrive in the mail to help determine a deceased’s financial situation are practically over. While best practices are still being established, it is clear that digital property is becoming increasingly more important in estate planning.
Individuals must be proactive in creating and updating an inventory of all digital accounts, including passwords and PIN numbers. Instructions are needed for each account, and access information to the deceased’s cell phone (for multi-step authentication processes) should be provided. Information should be kept with a lawyer or trusted individual. If necessary, a lawyer can assist with the creation of a trust to keep digital property out of court.
The estate planning lawyers at Murphy Desmond can help you with digital property and other details of your will or estate plan. It’s important to regularly update your will for changes in family, marital status, asset/property acquisition or loss, and digital property data.
The great digital beyond
A friend recently told me of the challenge she faced sorting through her aging parents’ belongings to prepare their home for sale.
Her father had died years ago and her 94-year-old mother had been living in an assisted-care facility for more than a year. Most of the items of sentimental or personal value had already been distributed to her siblings. What remained were her parents’ personal archives — letters, photos, employment/financial/legal/health records, all tangible, physical objects that, once gone, would be gone forever.
In the internet age, personal archives are no longer limited to the tangible. In fact, much of one’s personal archives is now digital — emails, texts, photos, videos and social media accounts. And there’s a lot more content generated and stored than ever before. Some is saved on personal storage space, such as a computer hard drive. Other material lives in the cloud in services like Facebook, Google Mail and YouTube. In most cases, that content is protected by some kind of password.
So what becomes of all of that information when someone dies? Does it remain online forever? Can it be altered, deleted or downloaded, and if so, by whom? And how do these digital artifacts represent your life and legacy?
These questions inspired Evan Carroll and John Romano to create the website thedigitalbeyond.com to address these needs and concerns. Together they wrote the book “Your Digital Afterlife” in 2011. Since that time an entire industry has emerged to help people plan for managing their digital legacy. Thedigitalbeyond.com lists dozens of such online services. Some are free while others are fee-based.
Knotifyme.com, for example, “answers the question, ‘What happens to all my online accounts if I get amnesia, Alzheimer’s or if I leave from this world?’ With knotify.me you set future notifications to be sent to your family and beloved people or to yourself, ensuring that nothing of your digital life will be wasted (and) transfers your online property/heritage (urls, domain names, e-mail & social network accounts, etc.) to whomever you wish to continue it in the future!” You can sign up for this free service through your Facebook, Twitter or Google accounts. In short, according to its tagline, Knotifyme.com “manages your digital heritage.”
To address financial matters, consider Legacyarmour.com, which describes itself as “a secure asset protection platform where you organize your important information in encrypted vaults, and …. automatically deliver it to your designated recipients on a scheduled date, or in case of your death or incapacitation.” It is a fee-based membership service with different levels of coverage and prices depending on what you want.
The rapid growth of the web has outpaced the law in the realm of the digital afterlife. It wasn’t until 2015 that the Uniform Law Commission, a nongovernment organization, created the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA). It has since been adopted by 40 states and been introduced in five more this year. As its name suggests, RUFADAA “allows fiduciaries to manage digital property like computer files, web domains, and virtual currency, but restricts a fiduciary’s access to electronic communications such as email, text messages, and social media accounts unless the original user consented in a will, trust, power of attorney, or other record.”
Some online services have their own policies for providing access to a person’s account after he or she dies. Facebook allows users to designate a “Legacy Contact” who is legally permitted to enter someone’s account to post, respond to friend requests, and update profile and cover photos. The Legacy Contact may also be given the power to download an archive of the photos, posts and profile information in that account. Facebook users can also simply opt to have their account permanently deleted after their death. Google offers an Inactive Account Manager feature that allows users to share parts of their account data or notify someone if they’ve been inactive for a certain period of time.
One important and often repeated piece of advice is to never put usernames and passwords for any online accounts in your will, as it becomes a public record once it is entered into a probate court file.
It is never too soon to start estate planning, whether it be for tangible assets or digital ones. It may be well worth your time to investigate the policy options of your online account services and perhaps even avail yourself of some of the many digital afterlife services available today.
Cerise Oberman, SUNY Distinguished Librarian Emeritus, retired as dean of Library & Information Services at SUNY Plattsburgh. She can be reached at firstname.lastname@example.org. Tim Hartnett is associate librarian at SUNY Plattsburgh, Reach him at email@example.com.
Planning for a Digital Legacy
Digital property is increasingly becoming a more important part of estate planning. Individuals should consider their digital property, in addition to their tangible assets, when finalizing and reviewing their estate plans.
A person’s digital property and electronic communications are referred to as “digital assets” and the companies who store those assets on their servers (Google, Facebook, Apple, etc.) are referred to as “custodians.” Digital assets are typically governed by terms of a service agreement — not by property law. These service agreements are unhelpful when a user passes away or becomes incapacitated. As the number of digital assets we have increases daily, so does this growing issue. To address this, many states have adopted the Revised Uniform Fiduciary Access to Digital Assets Act (UFADAA), which allows a fiduciary the legal authority to manage another’s property and specifically allows Internet users the power to plan for the management and disposition of their digital assets.
Digital assets should be included in your normal estate planning and wealth transfer conversations with your estate planning attorney and family members. Your estate planning attorney may create an amendment to your existing will, trust, or power of attorney to give the designated agent the authority to direct or dispose of your digital assets. This amendment may take the form of a Virtual Asset Instruction Letter, which allows you to list accounts, instructions for those accounts, and the person(s) designated to access them.
Digital assets, while not always tangible, can be very valuable. For example, airline miles and hotel points have obvious monetary value, while photos, emails, and other creative works have sentimental value. As a result, it is important for individuals to have a plan for photos, email and social media accounts, financial accounts, and online memorabilia and documents.
Please contact us to request additional resources on creating a digital estate.
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New Law Affects Estate Planning for Digital Property in Indiana, Pending in Illinois and Ohio
The Revised Uniform Fiduciary Access to Digital Assets Act (or “UFADAA”) will take effect in Indiana on July 1. The new law addresses the rights of a fiduciary, such as a personal representative, trustee, attorney-in-fact or guardian, to access digital property, such as online financial accounts, emails, texts, social media accounts and online document and picture storage. UFADAA will replace Indiana’s current digital access statute, which applies only to personal representatives.
To date, UFADAA has been adopted by 16 states and is currently pending in approximately 16 more states, including Illinois and Ohio.
Individuals who wish to take full advantage of the features of UFADAA will need to take action, including updating their estate planning documents, as described below. Failure to take action may result in the loss of access to digital property (or even the deletion of digital property) upon a person’s death or incapacity.
Under UFADAA, a company that stores digital property (referred to as a “custodian”) may provide an online tool that allows the owner of the digital property (referred to as the “user”) to specify whether the user’s digital property should be disclosed to others and, if so, to whom. If a custodian does not make an online tool available to its users or if a user does not take advantage of a custodian’s online tool, then the following rules will apply.
Estate Planning Documents
A user may include provisions in his or her will, trust or power of attorney document to either allow or prohibit fiduciary access to the user’s digital property. Adding express digital access provisions to wills, trusts and power of attorney documents will be beneficial for most individuals since it may be cumbersome to complete the online tool for each and every digital asset and since not all custodians are likely to provide an online tool, at least not initially.
Terms of Service Agreements
If a user provides no instructions, either by using an online tool or by adding digital access provisions to his or her estate planning documents, then each custodian’s terms of service agreement will govern whether the user’s fiduciaries will have the ability to access the user’s digital property and a custodian’s terms of service agreement may prohibit fiduciary access completely. For this reason, it will be important for most individuals to take action, either by using online tools or by adding digital access provisions to estate planning documents (or both).
If a user does not use an online tool or add specific digital access provisions to his or her estate planning documents and if the custodian’s terms of service agreement does not otherwise restrict fiduciary access, then the following default rules will apply.
- Personal Representative. A deceased user’s personal representative (i.e., executor or administrator) will be permitted to access the deceased user’s digital property for purposes of carrying out the personal representative’s duties but will not have access to the content of the deceased user’s electronic communications, such as emails and text messages, absent express authority in an online tool or a will.
- Trustee. If a user creates a trust and the user’s digital property passes to the trust, the trustee will be permitted to access the user’s digital property for purposes of carrying out the trustee’s duties but will not have access to the content of the deceased user’s electronic communications, such as emails and text messages, absent express authority in an online tool or in the trust agreement.
- Attorney-In-Fact. If a user authorizes another person (called an “attorney-in-fact”) to act for the user under a power of attorney document, the attorney-in-fact will be permitted to access the user’s digital property for purposes of carrying out the attorney-in-fact’s duties but will not have access to the content of the deceased user’s electronic communications, such as emails and text messages, absent express authority in an online tool or in the power of attorney document.
- Guardian. If a user becomes incapacitated and a guardian is appointed to manage the user’s financial affairs, the guardian will have very limited authority with respect to the user’s digital assets, absent express authority in an online tool or other estate planning document. The guardian may request that the user’s online accounts be suspended or terminated but otherwise will have no access to the user’s digital property without a court order that is issued after notice to interested persons and a hearing.
Taft’s private client attorneys will send an additional update as things proceed in Ohio and Illinois. In the meantime, we encourage you to contact us with questions about UFADAA or if you wish to take advantage of its provisions.