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Does your estate include digital assets?

On Behalf of | Jan 9, 2023 | Estate Planning

One of the first steps that many people take when they decide to do estate planning is simply that they go through and make an inventory of everything that they own. You probably have a general idea of your assets, but it can be helpful to see if there’s anything that has been forgotten or to check current values and ensure that you are appraising everything properly.

As you do this, you may discover that you own a fair amount of digital assets. These have become more and more common over the last few decades. To some degree, it started with the rise of digital music, which proliferated online, but it also includes things like movies, video games, software programs for businesses and much more. If you have substantial digital assets, can you put them in your estate plan?

Do you own them?

The short answer is that you can – but only sometimes. It really just depends if you own them or not. In many cases, companies only sell a license. If you buy a digital file, the paperwork will say that you’re actually buying a license so that you can access those files whenever you want.

The problem is that this license may last for the rest of your life, so you feel like you own the file. But you do not own it, and you’re not allowed to transfer the license to anyone else. This means that, even if you’ve invested thousands of dollars, you probably cannot put these digital assets in your estate plan. They cannot be transferred upon death in the same way that tangible assets can be.

This is just one thing to think about during modern estate planning, so be sure you know exactly what options you have.