Are Your Digital Assets Lost Forever?

If you are not careful with your estate plan, your digital assets may be stuck in the cloud or remain under a company’s control, causing your digital assets to be lost forever.

When people think of estate planning, they think about tangible personal assets, but a type of asset that people tend to forget about is their digital assets. It is important to consider how you want your digital assets dealt with and who has access to them after your passing.

What Is a Digital Asset?

Digital assets are online accounts that are password-protected, such as social media accounts, gaming accounts, financial accounts, blogs, etc. With these types of accounts, it’s easy to forget to provide your passwords to a trusted individual so that they can access them after your passing. It’s recommended to create a list of all your accounts along with the passwords. Additionally, some accounts require secondary authentication, such as private keys/codes, so make sure to include these along with your accounts and passwords. This makes it easier for your fiduciary to have access to these accounts after you pass to follow through on how you want your digital assets to be handled. However, due to data privacy laws, it’s not as simple as just providing someone with your password; you need to legally provide consent. 

Laws Enacted to Protect Accessibility to Digital Assets

The Uniform Law Commission drafted a Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) in 2015, enabling states to adopt it as law to address the issue of accessibility of a decedent’s digital assets. Both Pennsylvania and Ohio have adopted their own version of it.*  RUFADAA prevents companies from providing any individual access to the decedent’s digital account without the decedent’s consent, but it allows a named fiduciary to access the accounts of a decedent or an incapacitated person with consent. A fiduciary can be an executor, trustee, conservator or an agent named within the decedent’s estate plans. Companies have also begun to include an additional agreement beyond their general terms of agreement to allow account holders (decedents) to name an individual who they give consent to have access to their account once they pass. 

RUFADAA clarifies a hierarchal order for situations in which an agreement and an estate plan conflict based on the individual named and when one will supersede the other. This means that if the decedent created a digital account with a company and listed an individual access through the company’s additional term agreement, this agreement will supersede any person named in the decedent’s estate plans. However, if there is not an additional term agreement with the company or the decedent decides not to use it, then his or her estate plans are enforced.

If neither a company’s additional term of agreement nor a fiduciary is listed in one of the estate planning documents (will, trust, power of attorney), then the company’s basic terms of service for the decedent’s account is used. Lastly, if the company’s terms do not address the accessibility of an account after death, the provisions within RUFADAA, given that the decedent’s state of residence adopted it, will be the default. RUFADAA affords the fiduciary with access on an as-needed basis. This significantly limits the fiduciary to carry out the decedent’s wishes on his or her digital assets. 

For that reason, it is important to have an individual named in one of these documents. The best practice is to contact your digital account’s company to see if it has an additional agreement in which you can list a name, and if not, read the company’s terms of agreement to see if they address the accessibility issue. Since not all companies have implemented additional agreements in which a trusted individual can be listed, it is important to also include the individual in your estate plan. This ensures your digital assets will be taken care of from both an agreement and an estate plan aspect, confirming that your digital assets are not lost after your death.  

How Can Schneider Downs Help?
The Schneider Downs Estates and Trusts team can discuss issues regarding your digital assets with you and how they can be addressed within your estate plans to be effective. If you have any questions about your digital assets, contact us at [email protected]. 

*[1] Pennsylvania Senate Bill 320, Act No. 72 (2020); Ohio House Bill 432, Chapter 2137 (2017).

About Schneider Downs Private Client Services 

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