Estate Planning for Your Digital Assets
Most of us have a substantial number of online accounts ranging from email, social media, blogs, web pages, to music, book, and movie collections. Your digital accounts likely also include online banking accounts and investment portfolio information. These online accounts are considered our “digital assets,” and they often contain information near and dear to us—personal data, financial information, photographs, communications, and writings.
If you have not entrusted someone with the accounts’ usernames and passwords, existing laws may make it difficult for a surviving representative to access the information. Without proper planning, there may be no way to transfer digital items of value after you have passed away.
Presently, federal legislation regarding digital property does not exist. In states without specific legislation, the terms of service or privacy policy established by the service managing the asset (Google, Tumblr, and Facebook, for example) will determine what may be done with the asset when the owner dies.
In Nevada, a limited 2013 statute authorizes a personal representative to terminate a decedent’s accounts on any “Internet website providing social networking or web log, microblog, short message, or electronic mail service.” The statute allows a representative to take action subject to any restrictions stated in the decedent’s will or ordered by the court. Specifically mentioned are social networking sites, web log services, microblog services, short messaging services, electronic mail services, and “similar electronic or digital asset of the decedent.”
The Nevada legislature specifically withheld authorization from a personal representative to direct the termination of any financial account. Further, the law does not allow a personal representative’s termination of a digital account or asset to “invalidate or abrogate any conditions, terms of service or contractual obligations the holder of such an account or asset has with the provider or administrator of the account, asset or Internet website.” NRS 143.188 Sec 1-3.
While the Nevada law addresses access to digital assets, it leaves unresolved the issue of transferring ownership of those assets. This is where estate planning can help clarify how digital assets of value should be handled. By including directives regarding your digital assets in your estate planning documents, your personal representative will have the best opportunity to handle those assets according to your wishes.
The Uniform Law Commission is also taking on this issue and recently created the “Fiduciary Access to Digital Assets Act,” which is designed to give executors, trustees, or a court appointee complete access to a deceased person’s digital assets. This Act specifically addresses who has the authority to access, manage, distribute, copy, or delete digital assets and accounts. Four different types of fiduciaries would have authority to take over the decedent’s digital accounts: a personal representative, a conservator appointed by the court, an agent under power of attorney, or a trustee. The Uniform Law would allow the fiduciary to have the same authority over the account as the account holder had during his lifetime.
The Uniform Law Act has not yet been enacted in Nevada, but may become law in our state based upon Nevada’s positive history of adopting Uniform Laws. The advantage will be greater rights and predictability over digital assets. Until then, specifically including your digital assets in your estate plan is the best way to make sure your desires are honored regarding these valuable assets.