Privacy, Access, and the New Pennsylvania Digital Assets Act: The Future is Now. Is Your Estate Plan up to Date?

by Judith Harris

Our use of computers, the cloud, and online technology figures prominently in our professional and personal lives. And for many, our reliance on such technology has increased during this year, as we adapt to new work environments and business practices dictated by COVID-19.

Therefore, it is good news that on July 23, 2020, the Pennsylvania Legislature passed Act 72 of 2020, the PA Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA ). This law becomes effective on January 20, 2021, making Pennsylvania the 48th state to adopt the transfer of digital assets legislation. Before RUFADAA, fiduciaries – such as executors, agents, trustees, and guardians–did not routinely have the authority to gain access to one’s digital assets or electronic communications, particularly after one’s death. Prior to the Act, PA law provided no legal procedure to authorize custodians of digital assets and electronic communications (such as Facebook, Google, and Apple) to disclose one’s digital assets to a fiduciary.

What are Digital Assets? The Act defines a “digital asset” as “an electronic record in which an individual has a right or interest.” These assets can include the following: 1. Emails. 2. Your Contacts on your smartphone. 3. Files stored on the hard drive of your computer or other drives, including, for example, your saved passwords to banking and investment accounts. 4. Photographs, documents, music, and video stored in the cloud or posted to social media sites. 5. Blogs written by you. 6. Cryptocurrency. 7. Popular digital storefronts such as eBay© pages and valuable web domains.

What the Act Does and Does Not Do

RUFADAA is welcome legislation but is no substitute for a carefully constructed estate plan. The Act gives you the power to plan for the disposition and management of your digital assets (during life and after your death) in the same manner as you can plan for bank accounts, real estate, stocks and bonds, business assets, and tangibles. How? 1. Include specific instructions in your Will, Trust, and Powers of Attorney; and 2. Maintain (with your estate planning documents) an up-to-date list of your digital accounts, terms-of-service agreements, and all modifications and deletions to online tools associated with each such account.

The Act does not specify the degree of access or control over the content of your digital assets you wish to confer on your Agent under Power of Attorney, Executor of your Will, or Trustee of a trust you create. As such, your estate plan is not complete unless each such document and related instructions address these issues. Ask yourself: Which of my digital assets do I want deleted or kept private in the event of my incapacity or death? Which of those assets do I want disclosed to my agent, executor, or Trustee? Do I want those fiduciaries to have access to the actual content of my digital assets (such as specific emails), or merely the records of such electronic communications?

Access to a digital asset is routinely governed by a terms-of-service agreement issued by the custodian who maintains, processes, or receives a digital asset of a user. Not all custodians issue such agreements. And not all such agreements are alike. Certain custodians offer their own specific digital asset management options. (Example: the “legacy contact” option offered by Facebook.)

The Power of Online Tools vs. Your Will, Trust, and Power of Attorney

Certain custodians’ digital asset management options allow a user to make use of an online tool to instruct a custodian to disclose some or none of the user’s digital assets, which may include electronic communications. If the online tool permits the user to delete or alter a direction regarding disclosure, that direction will, under the new Act, override the user’s contrary direction in a Power of Attorney, Will, Trust, or other record. In the absence of an online tool offered by the custodian, or in the event of a user’s non-use of such a tool, the user’s Power of Attorney, Will, Trust, or other records may serve to permit or prevent disclosure of some or all of user’s digital assets to a fiduciary.

RUFADAA is a welcome but complex law. Consult with an adept estate planning attorney to ensure that your estate plan is poised for the future…

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