A good estate plan considers what will happen to all of your valuable assets. This includes the obvious things like bank accounts, real estate, investments and ownership of a business. But nowadays, many estate planning attorneys are asking their clients what they own on the Internet as well.
What happens to your online digital assets matters. A Facebook or Twitter account may seem like little more than a fun diversion now, but it could potentially have business value if you have enough followers. Likewise, you may have spent quite a bit of money on your iTunes media collection. But without the usernames and passwords to these accounts, your loved ones may not be able to get at them after you pass away.
It may seem like leaving behind a list of passwords would be enough. But technically, much of what you own on the Internet cannot be transferred to someone else. That is because you are often buying a license, which gives you permission to play that .mp3 on your computer and mobile devices, but not to sell or give it away.
State laws largely have yet to catch up on what rights people have to pass on their digital assets to heirs and beneficiaries. Currently, only five states have regulations on the subject, with another 12 states expected to consider legislation next year. Neither group includes California.
For now, users may be able to put their usage licenses and passwords into a trust, though which they may be transferable. Access to online accounts that are allowed to be inherited can be taken care of in a will.
The law surrounding these assets is still evolving. It may be necessary to revisit this portion of your estate plan in a few years to adjust.
Source: The Wall Street Journal, “Make Sure You Know Who Will Inherit Your Twitter Account,” Arden Dale, Sep. 18, 2013