Modern Estate Planning Blog

Good news! California is taking steps toward putting a legal framework in place for handling digital assets after someone passes away.  I’ve been talking to you for years about including digital assets in your estate plan and now the law is catching up. Digital assets such as email accounts, social media online, and even online bank accounts often get completely lost in the shuffle when someone passes away.  Here’s a recent example of this nightmare…

Recently, I heard from a woman who was responsible for closing her mother’s estate. Most of the probate process went smoothly – except for her mother’s PayPal account. Sadly, in the last few years of her mother’s life she suffered from dementia. As a result, her mother kept changing her passwords and creating new email addresses when she forgot how to get into the old one. Her mother did have several email addresses written down and even a few passwords. But, none of them worked for her PayPal account.

When she exhausted all of her options, she contacted PayPal. There were months of calls back and forth and even requests from PayPal to get copies of her mother’s death certificate and social security card and several other forms of identification – MULTIPLE requests. She complied every time. But, each time she sent the information the response was the same.

*crickets*

Nada, nothing. The issue was dropped with no explanation by PayPal. Ever. While they have a process in place to accommodate for situations where you have all of the deceased’s required information, things fall apart when a piece of that information is missing.

She never got access to her mother’s account.

The good news is that a new law in California will allow an account owner to identify an agent who can access online accounts upon their death. Conversely, you can also indicate that you wish to close your accounts immediately and deny access to anyone.

This new law was passed September 24, 2016 and will take effect January 1, 2017. Here are some highlights:

• Companies can create an online tool that allows you to provide instructions to disclose (or not to disclose) online information to people you’ve identified.
• Companies are now required, under specified circumstances, to disclose information to your agent if you consented to that disclosure using the online tool or a legal document.
• You can also provide instructions for digital assets in your estate planning documents.

This law does not replace the need to share information related to your online accounts. Someone will need to know what accounts you have in order to access them. And, it would be great if you would leave usernames, IDs and passwords. But, because this info, especially passwords, change regularly it isn’t always possible. So in those cases, in California anyway, you can provide consent which allows your authorized agent to access the accounts you’d like them to.

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