Until the summer of 2016, Florida, like most other states, did not have laws on the books to address access to individuals’ digital assets either during incapacity or after death. In “Florida Passes Fiduciary Access to Digital Assets Act,” WealthManagement.com looked at the new law and the estate planning repercussions for those looking to plan for digital assets.
One question that always arises when discussing digital assets is this: What exactly is a digital asset? Well, that definition is expansive and only continues to grow as more and more services are provided digitally to consumers on phones via apps and online.
A digital asset could be anything from an email or text message to online photos, social media accounts, music streaming accounts, websites, blogs and even online dating profiles. The new Florida law, however, pares down the definition to four main points:
1. Anything stored on your phone, computer or other digital device (such as a camera or Kindle)
2. Any uploaded content, such as photos or documents uploaded to a Google Drive or iCloud account, for example.
3. Rights to digital property, such as a domain name or even an online gaming account.
4. Both the catalog and content of any electronic communication.
While few things are clear-cut when it comes to digital assets, many of these points are self-explanatory. However, the fourth point merits a bit more discussion. You can think of it like a letter you’d send in the mail. The envelope contains the sender’s name and address, as well as the recipients. It also has information from the Post Office about when and where it was processed. That would be the catalog. The letter inside would be the content. For an email, the catalog would be the sender’s and recipient’s email addresses and the date and time of the email. The content would be the message itself.
In requesting the disclosure of digital assets, it is proportionally easier to gain access to assets like the catalog. There are often more hurdles to access content, since there is a greater assumption of privacy and protection. However, any fiduciary can request access by contacting a custodian and giving them the relevant information. A custodian is then required to disclose the digital asset, but they do have sole discretion regarding how to do so. If a fiduciary is not granted access or takes issue with the way they were given access, the new law allows them to get a court order to obtain access to the digital asset. However, if the custodian is acting in good faith, they are immune from liability.
Nine times out of ten, we’re not thinking much about a fiduciary’s future access to a digital asset when we sign up for a new account online or through an app. However, the Florida law addresses the terms-of-service agreements that most of us tend to accept without much thought. According to the law, any terms-of-service agreement is superseded by any online estate planning tool provided by the custodian or any written direction in estate planning documents.
One such example would be Facebook’s Legacy Contact option. Should a Facebook user opt to name a Legacy Contact, that person has certain access to an incapacitated or deceased person’s profile. However, the profile owner must have named someone as a Legacy Contact. According to the Florida law, a Florida resident could also give someone access to a digital asset in a will, trust document, or Power of Attorney.
One of the reasons it’s so important to do your estate planning early is getting custodians on board. Whether it’s a financial or digital asset, all assets should be aligned with your estate plan, verified to ensure correct alignment and then tracked over time as your assets change. Custodians often have their own procedures, rules and forms, and working with them now can prevent headaches and even legal battles in the future.
That’s why at Family Estate Planning Law Group, the alignment, verification and tracking of assets is a foundational aspect of how we do estate planning with our clients. We work with you and the custodians of your assets to ensure that all assets are aligned with your plan. Then, we coordinate with your custodians to verify that your assets have been aligned correctly, and finally, we track your assets over time. Your assets will probably change in type and in value over time, so we work with you to ensure that your assets are always in line with your plan.
For more information about our unique process, explore our website and contact us to schedule your consultation today!
Reference: WealthManagement.com (June 27, 2016) “Florida Passes Fiduciary Access to Digital Assets Act”