Estate Planning Should Include Digital Assets, Says Attorney with Gilfix & LaPoll
Palo Alto, CA (Law Firm Newswire) December 23, 2013 – A prominent estate planning attorney says digital assets need to be considered as part of estate planning.
“In today’s world, many people own significant assets that exist only in digital form, whether it is currency such as Bitcoin or items of sentimental value such as family photos,” said Palo Alto estate planning attorney Michael Gilfix. “There needs to be a plan to pass these assets on to one’s heirs.”
Gilfix said that online assets may also include such items as PayPal accounts, frequent flyer miles, iTunes libraries, online gaming accounts and many others. Any system for storing value electronically has the capacity to store significant assets that should rightfully be passed down to one’s heirs. However, without a plan in place, their value could be lost.
Each provider of online services has its own policy for access to user accounts. Some states have passed laws that grant the executors of an estate access to online accounts. Of course, access to the accounts is often simply a matter of knowing the basic account information, including the relevant passwords.
According to Gilfix, people engaged in estate planning should make a list of their digital assets, just as they take stock of their traditional assets. The list should include instructions for accessing the accounts, including usernames, passwords and a description of what is contained there. The list should be stored in a safe place, where the executor or personal representative of one’s estate will be able to find it (but an unauthorized person will not). The list may be kept with one’s attorney or in a safe deposit box. It can also be kept on an online data storage service; some specific services have been created for this very purpose.
In addition to username and password access, one’s executor or personal representative needs legal authority to use the accounts. Possessing the password to an online bank account does not mean that an executor can or should issue any payments. Estate planning documents, such as a will, and any trusts or durable power of attorney documents will dictate who has the authority to deal with online accounts.
Facebook: Like Us!
- Navigating intestacy for surviving spouses in California
When someone dies without a valid will, his or her condition is called “intestacy.” Each state has its own laws for determining how the deceased’s estate is divided in cases of intestacy. When the deceased’s spouse is still living, all community property (meaning property acquired during the marriage) automatically goes to the spouse, while separate […]
- Palo Alto Breaks Ground on Innovative Playground for All Children
On June 23, construction began on what is being coined the most innovative and inclusive playground in the United States. The playground will be called “Magical Bridge” and will be located on 1.28 acres of land between Adobe Creek and Mitchell Park’s southern-most tennis courts. The park will have 15 zones that will accommodate the […]
- Crummey trusts can maximize benefit of annual exclusion
The annual exclusion to gift taxes is rather straightforward: tax-free, someone can give away up to $14,000 per year. Spouses, through gift-splitting, can effectively double that annual exclusion to $28,000. As a basic precondition, the gift must consist of present interest (or an asset that the recipient can immediately use), such as cash. Gifts given […]
- Within the context of estate planning, charity can come in many forms
Many people considering estate planning want to incorporate charitable contributions in their estate plan. Many also wish to shield estate assets from taxation. In addition, they may wish to benefit from a tax deduction for charitable contributions and save on capital gains taxes that would be levied on appreciated property. There are two basic irrevocable […]
- Even with recent tax reforms, it may not be wise to bypass a bypass trust
As the lifetime estate tax exemption has risen, estate planners have found themselves enjoying greater breathing space when optimizing the amount of wealth that can pass to an estate’s heirs tax-free. In 2014, estate tax protection covers $5,340,000 per person. While the steadily larger exemption has seemingly made so-called “bypass trusts” less relevant, such trusts […]