Digital assets no longer are just for bank accounts
In today’s digital age, managing valuable digital assets is an increasing concern, especially when it comes to estate planning. Why? Because, as citizens of a technology-driven world, we continue to leave behind digital footprints even after we’ve passed.
If you’ve developed digital assets — websites, games, designs, photos, all sold or viewed digitally — you need to be aware of their value. You also need to identify the asset in your estate plan: Referencing the asset, transferring and/or incorporating the asset into your trust or estate plan are critical.
People who own digital assets fall under the umbrella of “content creators,” which are monetized in different ways. These include YouTubers, bloggers, influencers, gamers and streamers. Advertisers pay YouTubers to place ads on their sites and videos, or on the company whose product is used by the YouTuber or influencer.
For instance, if a person models a clothing brand or shows how to apply makeup using a specific cosmetic brand, then these people are typically paid by royalties or by the company for products sold through the website. Video streamers on Twitch, a live web-based streaming video platform, get paid by selling their products or by the number of subscriptions sold on Twitch.
However, if that person were to die, someone needs to be able to have control of the asset in order to continue collecting the revenue. Many young adults do not realize the existence of an asset value nor the need to delegate a person to obtain authority over the asset in the event of their death or disability.
This issue is one of several regarding digital asset management. Increasingly, another concern involves maintaining or closing social media accounts associated with a loved one upon their death. Some people want their accounts closed down immediately, while others have gathered genealogical history, photos for family and other significant information that they want others to share.
Even Pinterest, which has climbed to more than 291 million users sharing images, is now removing “pins” that may violate copyright infringement. When this happens, the social media giant notifies users with an email, stating: “We're getting in touch to let you know we received a copyright complaint and have removed one (or more) of your pins. The complaint wasn't directed against you or your pin; it was directed against another user's pin of the same content …”
Under these circumstances, product owners and developers claim ownership of their design, even when it is produced digitally. If you sell designs online as part of an earned income and then learn someone copied your design without paying you for it, it violates ownership interest. Designs belong to the owner and are his or her digital assets, which have value.
So how do we protect our digital assets?
Develop a plan and think about who you would want to serve as “trustee” of the asset. This person could be the same successor trustee of your other routine assets, or it could be someone else entirely. You’ll want to ask yourself questions such as: How will the successor trustee have access to administer the asset? Where do you keep the username, password and administrator information?
Take time to think about what you want in the digital space and the specifics needed in order to protect or close out interests, or transfer them to others. When developing a plan to manage your digital assets, it may be beneficial to talk to an estate plan lawyer to help you put your cyberspace footprint into words.
Sharan L. Levine is a partner at Kalamazoo-based Levine & Levine Attorneys at Law. She has more than 35 years experience in all aspects of corporate compliance, business formation, business succession planning and probate, and estate planning and trust administration.