On January 20, 2014

Colorado residents may be interested in what happens to their digital assets when they pass away and what they can do to protect those items. Digital assets are those that are primarily available online, like online-only bank accounts, Paypal accounts, e-books and other digital products sold online, blogs, email and social media accounts. There is relatively little law that covers the post-death distribution of these assets, so individuals are advised to take control of the matter with a digital estate plan.

A digital estate plan is much like a will or trust, except that it only deals with digital assets, and may serve to provide some guidance as to how the assets should be managed. The first step to creating a plan is to take an inventory of all appropriate digital assets. That inventory should include where the assets are housed, how they are accessed and the necessary password information.

Once the assets are inventoried, the next decision is how they each should be dealt with. An individual may want the contents of bank or Paypal accounts distributed to heirs or Facebook or Twitter accounts to be maintained as a memorial. Many online providers may not allow the assets to be transferred or accessed. In those cases, it may be wise to simply ask a beneficiary to close the accounts with no further action.

It is also advisable to place the right person in charge of executing the digital asset plan, as it will require a person with sufficient computer skills and understanding. An estate planning attorney may be able to help coordinate the preparation of a directive that provides for the administration and disposition of these assets that can be both financially and emotionally valuable.

Source: Market Watch, “Who gets your digital fortune when you die?“, Andrea Coombes, January 10, 2014

Categories: Estate Planning

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