WHAT DO DIGITAL ASSETS HAVE TO DO WITH ESTATE PLANNING?

What is a digital asset and why do I care? If you have an email account, social media access, or use your computer to access accounts – you have digital assets. As we go through our day-to-day lives, we do not often consider – what happens to these accounts when I die or become incapacitated?

WHAT IS A DIGITAL ASSET?

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A digital asset is anything that exists in a computer format (sometimes referred to as binary code format) that also comes with the right to use. If data does not include the right of use, it is not considered a digital asset. Simply put, Digital assets include but are not exclusive to: digital documents, audible content, motion picture, and other digital data such as email accounts, online financial accounts, personal blogs, and social media and networking websites, as well as computer accounts and passwords.

WHY DO I CARE?

What happens when you can longer access your digital accounts? Is important information lost forever? Are your social media accounts left on forever? What if you wanted someone to be able to access, control, turn off, or otherwise manage your digital access once you were no longer able to do so yourself?

Planning for digital assets is important because:

  • It makes things easier on loved ones
  • Prevents losses to an estate
  • Helps prevent the loss of personal information
  • Prevents information from being revealed to people whom you would not want to have access
  • Can help prevent identity theft

HOW CAN I PLAN FOR MY DIGITAL ASSETS?

The law regarding access to another person’s digital assets are scattered and different across the states and many states do not have specific laws addressing the issue. One of the ways that you can plan for your digital assets is to include appropriate language in your will, trust, and financial power of attorney.

By expressing your wishes as to who can access and control your digital assets and in what way you would like them to handle your digital accounts, you have the ability to specify your wishes for the disposition of your digital assets. Although some states may not recognize your wishes concerning the disposition of digital assets, Texas DOES recognize the use of these provisions in your estate plan.

In Texas, if you have not used an online tool provided by your digital service provider to state your instructions regarding access and disclosure of your digital asset – then your instructions in your power of attorney, will, trust, or other plan document will control the access to and disclosure of your digital assets. If you give directions directly to a service provided (for example, your email provider), those instructions will supersede any contrary language in your power of attorney, will, trust or other documents. If you provide no instruction at all, the terms of service with each service provider will apply.

WHAT SHOULD I DO?

Despite the differences state-to-state regarding digital assets, the best action is to be proactive. You should state your wishes as part of your estate plan. Although not all states have the laws in place to officially recognize estate planning regarding your digital assets, a majority of states have laws in place to recognize these important assets and the remaining states have legislation under active consideration.

 

 

Jacob Wooley, a partner and estate planning attorney with Thomas Walters, PLLC, is ready to guide you through the complex world of estate planning. If you would like to meet Jacob and learn more about how best to protect yourself and your legacy, call 682-422-3495 to schedule your free, one-hour estate planning consultation. 

THE BENEFITS OF HAVING AN ESTATE PLAN

There are a number of reasons that people create estate plans. By taking the time to plan your estate you will also be able to:

Leave an Intentional Legacy to Your Family

If you want to make sure your spouse is taken care of when you die and that there are no complications, unnecessary legal issues or unexpected expenses and delays or if you want to ensure that your children’s upbringing and education are assured, a proper plan can ensure that your legacy is intentional and effective.

Quickly Disperse Property to Beneficiaries

There are a number of options that an experienced estate planning attorney can walk you through to help ensure that your property passes quickly and without complication. Arrangements can be made to help your family avoid the probate process, which is the legal process by which the court is asked to approve your will and the distribution of your assets. It can sometimes be a costly and lengthy process and options include living trusts, enacting and updating proper beneficiary designations, insurance policies, updating property titles and taking advantage of other laws that can simplify and expedite the transfer of your assets according to your wishes.

Choose Executors/Trustees for your Estate

Choosing competent people to be in charge after you are gone and giving them the necessary authority will save money, reduce the burden on your survivors, and simplify administration of your estate.

 

 

Jacob Wooley, a partner and estate planning attorney with Thomas Walters, PLLC, is ready to guide you through the complex world of estate planning. If you would like to meet Jacob and learn more about how best to protect yourself and your legacy, call 682-422-3495 to schedule your free, one-hour estate planning consultation. 

WHAT IF MY SPOUSE & I DIE TOGETHER? WHO WILL CARE FOR OUR MINOR CHILDREN?

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Guardianship Questions:

Q.        If my spouse and I die together, where would our children live for the first day or week or month until a judge can determine who will be their guardian? What if there are relatives we absolutely don't want them to live with, even temporarily?

A.        There is no simple answer to your question because where your children would live depends on when you die and where your children are when you die.

For instance, you and your spouse may be with your children when you both die, thereby leaving them without immediate supervision. Or your children may be at day care, at school, or with a babysitter, and that means the supervision they are receiving would soon be coming to an end. In these types of situations, it is likely that the police will show up and take charge.

The police would allow your children to be placed in the care of a relative or friend as long as they are convinced that person is not unfit to care for the children. The police can use the computer in their car to obtain this type of information. For instance, a relative who has a criminal record would probably not be allowed to take the children.

If your children are old enough to tell the police who to call, the police would likely do so and attempt to leave the children with the proper party. But if your children are too young to know phone numbers, addresses, or even complete names, or if no temporary guardian is available, then the police would take your children to Child Protective Services (CPS).

CPS would care for your children until a suitable family member or friend is located. CPS may place your children in foster care, if necessary, until a judge determines who the permanent guardian will be.

It may be the case that your children are already in the care of a relative or close friend when you both die. In such a situation, the police and CPS may never get involved with the care of the children. Instead, the children would most likely remain with that family until a judge makes a determination as to permanent guardianship.

You mentioned that there may be relatives you don't want your children to live with, even for a brief period. The problem is that if the police don't know how you feel, and if the relative otherwise checks out, the children may be placed in that person's temporary care. Unfortunately, it is too often the case that relatives want to control the children's inheritance, and they know funds will be available if they are acting as guardians.

You could prepare a witnessed and notarized document stating your intention regarding who you do and do not want to serve as guardian. In fact, that information is often contained in a person's will. But the problem is that this document will probably not be available when it's needed. Most people don't think to send their kids to school, daycare, or a friend's house with a copy of their will or other legal documents, and even if they did, the police may not be inclined to rely on the document's validity.

If the police show up and several relatives or friends demand to take care of the children, the police will most likely not make a choice between them, but will instead deliver the children to CPS. An investigation will then be conducted by CPS to determine who is most suitable to take care of the children until a guardian is formally named by the court.

You should be sure to state in your will who you want to serve as the guardian of your children in the event you and your spouse pass away before your children are legal adults--age 18 in Texas. You can name any person you want, and you can also provide a list of persons in order of preference. You can even name two persons to serve, but they must be married to each other.

Please note the answer to your question may be different if you don't live in a large Texas city.

Jacob Wooley, a partner and estate planning attorney with Thomas Walters, PLLC, is ready to guide you through the complex world of estate planning. If you would like to meet Jacob and learn more about how best to protect yourself and your legacy, call 682-422-3495 to schedule your free, one-hour estate planning consultation. 

Intro To Trusts

Trusts can be a great tool—when used for the right reasons. Trusts may be complicated to the lay person. But when used properly, they can be a valuable estate planning tool. Aside from making your wishes known, some of the common uses for trusts include: avoiding probate, minimizing federal estate tax, protecting your children from squandering their inheritance, providing for grandchildren’s education or other needs, protecting your spouse from your children of a previous marriage, protecting your children from a previous marriage from your spouse, protecting the inheritance of a special needs child, and much more.

What is a trust?

A trust is a legal arrangement in which a property owner (in this instance called a settlor) transfers ownership of his or her assets to a trustee, who then manages or controls the assets for the benefit of a third person called a beneficiary.

Think of a trust as a safe into which you put your assets, with the intention that they will eventually go to another party, the beneficiary. The beneficiary (or beneficiaries) can be one or several people, or even an organization such as a charity. Trusts are an effective tool for clients who want control over when and how their assets are used both during their lifetime and also how they are distributed upon their death. As you might suspect, there are many rules and regulations to be aware of when establishing trusts.

Example: In George’s living trust, he made a gift to be made at his death of $50,000 to his son, George Jr., as successor trustee of the trust for the benefit of George’s 12-year-old minor grandson, George III. George provided, among other things, that the principal of the trust could be used for the health and education of George III, and George also provided that if the assets had not been used by the time George III reached the age of thirty, then the trust would terminate and the remaining trust assets would be distributed to George III. When George later died, George Jr. was immediately in charge of the Trust and George Jr. managed the account as the successor trustee in charge for the benefit of George III.

Jacob Wooley, a partner and estate planning attorney with Thomas Walters, PLLC, is ready to guide you through the complex world of estate planning. If you would like to meet Jacob and learn more about how best to protect yourself and your legacy, call 682-422-3495 to schedule your free, one-hour estate planning consultation. 

Do I Have To Hire An Attorney?

So, do you have to hire an attorney to navigate the probate court process in Texas? Most of the time, yes. Texas courts usually require an executor to be represented by an attorney in a probate matter because an executor not only represents himself, but also the interests of beneficiaries and creditors. Texas law only allows a licensed attorney to represent the interests of others, therefore, preparing and filing pleadings in a probate matter without the assistance of counsel would constitute the unauthorized practice of law. Although courts allow limited exceptions to this rule, the result is that executors in Texas almost always have to hire an attorney to navigate the probate process.

The following is an example from the Denton County Probate Court’s Local Rules, explaining that the court does NOT allow individuals to represent themselves (also called “Pro Se”) in probate matters before the court:

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Jacob Wooley, a partner and estate planning attorney with Thomas Walters, PLLC, is ready to guide you through the complex world of estate planning. If you would like to meet Jacob and learn more about how best to protect yourself and your legacy, call 682-422-3495 to schedule your free, one-hour estate planning consultation. 

Trusts for Blended Families

A blended family is one that includes at least one spouse with a child or children from a prior marriage. The structure of a blended family can vary greatly and can include a husband with his own children, a wife with her own children, and even children born to the husband and wife together. In these situations, where individuals each have assets that they have brought to the marriage, they typically want to both provide for their spouse’s needs and ensure that their assets will ultimately go to their children. Without a detailed estate plan, a surviving spouse can easily disinherit whoever he or she chooses, including the deceased spouse’s children. To guarantee that what you want to happen with your assets will actually happen when you pass away, it is imperative to establish a plan ahead of time. Assuming your family will “work it out” after your death is a recipe for disaster. Additionally, letting the courts determine how your assets will be distributed can be very difficult for the family and loved ones. If you want to provide for your spouse and your children, particularly when your spouse is not the parent of your children, you may want to structure your estate plan so that assets are left in trust for them after your death. Not doing so can create a tragic outcome.

A married couple of a blended family could, for example, establish a joint trust that includes protection for the children and each spouse. This type of trust can provide great peace of mind in later years and eliminate hard feelings and strife within your family.

Example: Scott and Allyson have both been married before and each had two children from prior marriages. Scott brought significant assets into the marriage. To protect the surviving spouse and their respective children, and with the guidance of an estate planning attorney, Scot and Allyson established a comprehensive estate plan that included a trust. Both Scott and Allyson are designated income beneficiaries of the trust. Upon Scott’s death, Allyson becomes the sole income beneficiary of the trust and she can use the principal of the trust for her health, education, maintenance, and support. Upon Allyson’s death, the remaining trust assets will go to Scott’s children.

You will reap uncountable benefits in the long run if you have honest conversations with your spouse about your goals for the future and how you expect your assets to be distributed. If your children are adults, it may be advantageous to include them in the conversations so everyone knows what to expect. Blended families are very diverse and estate planning for blended families can be complicated. It is beneficial to obtain guidance from an estate planning attorney who specializes in these practices to ensure that, upon your death, your assets are distributed according to your desires.

 

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Jacob Wooley, a partner and estate planning attorney with Thomas Walters, PLLC, is ready to guide you through the complex world of estate planning. If you would like to meet Jacob and learn more about how best to protect yourself and your legacy, call 682-422-3495 to schedule your free, one-hour estate planning consultation.