PLANNING FOR YOUR DIGITAL ESTATE
We live in a digital world, where some of our most prized possessions no longer exist in physical form. Whether it is a digital photograph, the last voicemail you received from a deceased family member or your “wallet” full of crypto currency, a prized possession tends to be preserved by its current owner so that it may be passed to a worthy beneficiary.
The passing of property from one generation to the next is one of the focal purposes of estate planning. Thoughtful digital estate planning is crucial in a country where the average person values their digital assets at approximately $55,000.[i] Unfortunately, Pennsylvania and many other States lack laws specifically addressing the testamentary disposition of digital assets.
What is a digital asset?
A “digital asset” has been varyingly defined across legislatures, courts and scholars. The most recently proposed definition in Pennsylvania is “an electronic record in which an individual has a right or interest.”[ii] This broad definition could conceivably include text messages, emails, digital music files, digital photographs and drawings, social media profiles, etc.
For estate planning purposes it is important to know what digital assets you consider valuable and to understand how and where each is stored and accessed. In creating a digital estate plan, we must consider how the digital existence of the asset can be a barrier and if there is a way to plan around it.
What is the current state of the law regarding digital assets?
In Pennsylvania, there is no specific law, only proposed legislation. On October 28, 2019 the Pennsylvania Senate passed the Revised Uniform Fiduciary Access to Digital Assets Act (the “Bill”) and has given the Act to the House for review, revisions and vote. The Bill has been given a “Medium” chance to pass this next stage by the LexisNexis Legislative Outlook.
The Bill proposes to provide the owner of a digital asset the right, during his or her lifetime, through “online tools” like the Google plan described in Section III below or “in a will, trust, power of attorney or other record, [to] allow or prohibit disclosure to a fiduciary of some or all of the user’s digital assets, including the content of electronic communications sent or received by the user…” even to the extent the direction “…overrides a contrary provision in a terms-of-service agreement.”
Therefore, if the Bill becomes law, digital asset owners will have the ability to implement an enforceable digital asset estate plan. You would be able to be specific on what parts of your digital estate you wish for your fiduciaries (agent under power of attorney, executor, trustee) to access so they can manage and dispose of your digital assets according to your wishes. If the Bill is enacted, in the absence of a direction in your digital estate plan, the terms of service with each individual digital asset provider controls access to the digital asset after your death.
What happens to your digital assets after you die?
Because the Bill is not yet law, in Pennsylvania the testamentary transfer or non-transfer of a digital asset is currently controlled by a contract, rather than via a Will or intestacy. The controlling contract for a digital asset is often the terms of service you agree to when you start a service or purchase an electronic device. While the vast majority of users do not read the lengthy terms of service (lawyers included), it can be determinative on what happens to your digital asset after you die.
For example, the terms of service for iCloud, the remote storage iPhones utilize to store digital assets, state:
“Unless otherwise required by law, You agree that your Account is non-transferable and that any rights to your Apple ID or Content within your Account terminate upon your death. Upon receipt of a copy of a death certificate your Account may be terminated and all Content within your Account deleted.”
What this means is that you cannot designate via Will or beneficiary designation who inherits your iCloud account and its contents.
So, under Apple’s parameters, how can you plan? One option is to back up the data on your iCloud to a personally owned local storage device, such as a hard drive, and give that item in your Will. Alternatively, if you do not want anyone to have access to your iCloud, you can include a direction in your Will for your Executor to present your death certificate to Apple to terminate your account and delete its contents per the terms of service.
Google, on the other hand, embraces that its users may wish to give access to their account contents after they have died. Google utilizes a quasi-beneficiary designation procedure for providing access to your Google account after it becomes “inactive,” presumably due to your death or incapacity.
This service can be accessed in your Google account settings, under the “Data & Personalization” tab via the “Make a plan for your account” option. The service allows you to:
- Determine how long your account should be inactive before Google implements your plan (3-18 months). Google will notify you via email that your account is almost to the inactive stage you set. If you fail to respond and the inactivity period expires, your plan proceeds, as described below;
- Send a customized autoreply message to emails and other correspondences (g. messages sent to your YouTube Account) your account receives after your inactivity period expires. This is an opportunity to let people know that you have stopped using your Gmail or other Google services, and if you wish, include a final message from you;
- Choose up to ten people who, once your inactivity period expires, will be contacted and given access to your account for three months to recover your digital assets;
- Choose what part(s) of your account your digital beneficiaries have access to, g. any combination of photos, YouTube account, contacts, Google drives, emails, etc. When making these choices you should be cognizant of what you are sharing. You do not get to pick and choose within these categories what your digital beneficiaries have access to. If you grant access to your emails, it is to all your emails – good, bad and indifferent; and
- Choose whether after your digital beneficiary’s three months of access expires, or alternatively if you do not designate any digital beneficiaries upon the expiration of your inactivity period, if you would like your Google account terminated and all of its contents to delete.
Google’s account plan can be a great tool to utilize in your digital asset estate plan. More tech companies will most likely provide frameworks like Google’s account plan as digital estate planning becomes a more focal issue.
When you sit down to do your estate plan with your attorney, you are looking for comfort and certainty. Unfortunately, planning for your digital estate currently takes some creativity and does not involve the level of legal certainty that your estate planning attorney wishes to provide. However, by understanding the extent of your digital estate and your wishes regarding its disposition, we can help you use the tools available to put a plan in place to preserve what is most important to you.
[ii] Senate Bill 827, Session 2017, § 3902