It is a cliche to assert that the world of estate planning is ever-changing. Of course, laws are frequently altered by policymakers which affect the best practices for passing on an inheritance and saving on taxes. For example, just this year Congress agreed on new federal estate tax rates, which may influence how some decide to use wills and trusts to best plan for the future.
But it is not only legal changes that impact these issues--technological and cultural changes can uproot estate planning details as well. On the cultural side, consider the changing gender roles. Only a century ago, in many families it was expected that the oldest male would inherit almost the entire estate, with daughter and younger sons receiving only a minimal inheritance. While similar arrangements can be made today, the practice is incredibly uncommon. Cultural changes since then altered how these distributions are normally made.
Technology Changes Estate Planning
Changes on the technology front can impact estate planning even more rapidly. Consider "digital assets." While the term is used loosely, it usually applies to anything of value that one owns in in digital form--like a blog, website, or social media profile. In the past we have talked extensively about the various ways to pass on access and ownership of these unique pieces of property.
One of the more interesting legal questions related to digital property involves not how to pass them on, but whether they can be passed on at all. For example, last year several online news sites reportedly--falsely--that actor Bruce Willis was threatening to sue Apple for the right to pass on his iTunes music collection. The story was fictional, but it did raise a question that many found interesting: Can you pass on assets like an iTunes collection--even though you may not own the actual copyrights to the music itself. Is this the same as passing on a physical CD or record to another?
Believe it or not, the Bruce Willis hoax actually spurred creation of an academic article recently published in the Santa Clara Computer & High Technology Law Journal. In analyzing the legal questions, the author explained that the law is different between physical assets (like a CD) and digital assets (like a song downloaded from iTunes). Physical assets can be passed on via the "first sale" doctrine which provides flexibility on the re-sale and use of the content. Alternatively, digital assets are governed by something called EULA--"end user license agreement."
In other words, the companies that control these accounts--like Google, Amazon, Apple, etc.--each have unique EULAs which dictate transferability. The article points out that in most cases, the agreements are very limiting, making it difficult to completely pass on accounts or downloaded media to another.
If this is an issue that is important to you, it is critical to talk with your estate planning attorney to learn more about how you can best have your wishes accounted for in your plan.