How Digital Assets Figure Into Estate Planning
As digital assets, electronic communication and electronic information continue to grow, it has become more and more necessary for clients to address this property in their estate planning. Last fall, Governor Cuomo signed into law, Estate Powers and Trusts Law (EPTL) Article 13-A, entitled Administration of Digital Assets.
Consider the following scenarios:
Henry has an active social media account, and years of photographs saved in the cloud and on a photo sharing website. He would like his daughter, Kelly, to be able to access these accounts. He has given Kelly his usernames and passwords, but is concerned about the legal ramifications of her signing on to his personal accounts.
June has a similar concern, in that she is a 55-year-old digital video star who uploads weekly animal videos to her video blog. She has garnered quite a large following, and her video blog has become a significant source of income. June is concerned about what will become of the content of her video library and her video blog should she lose her mental capacity. Further, she wishes that her family continue uploading to the blog from her collection of videos so that the blog and income will continue if she should lose capacity.
With the relatively new digital assets laws in place, it has become common practice to include modifications to a person’s Durable Power of Attorney (POA) to grant their agent with authority to acquire, create, establish, access, control, modify, cancel, delete, continue, transfer, and take possession of accounts and devices containing or facilitating digital assets.
The POA provides one’s agent with the powers to deal with these accounts, assets and devices only during the principal’s lifetime. However, access and control of such accounts, assets and devices upon death of the owner can be provided for in a will and/or trust. If, however, Henry and June do not engage in some type of formal planning, EPTL 13-A provides that an executor, administrator, trustee, guardian, or person seeking a similar fiduciary role may petition the Court to obtain or access digital assets, electronic communications, catalogs of electronic communications, electronic information and records of the user. If not specifically provided for in a will or trust, the Court will ultimately have to determine who will inherit such digital assets.
As clients’ digital assets are beginning to resemble tangible assets, it is important to discuss this property with an experienced elder law attorney, to develop appropriate planning techniques regarding such assets. You may wish to include modifications to your Powers of Attorney, Will and/or Trusts to avoid costly applications to the Court by one’s guardian, executor, administrator or the like.
Because the laws codifying the administration of digital assets is relatively new, it is recommended that you contact an experienced attorney to address your digital assets planning needs.