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Estate Planning for Digital Assets: RUFADAA-Adopting and Non-Adopting States Granting Fiduciary Access, Identifying Digital Assets, Streamlining Transfers

Recording of a 110-minute CPE webinar with Q&A

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Conducted on Wednesday, July 20, 2022

Recorded event now available

This webinar will offer advice on transferring valuable and sentimental digital assets to heirs. Our transfer tax expert will explain fiduciary rights under the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) rules, discuss methods of transferring access rights to a fiduciary, and identify often overlooked digital assets to include in an estate plan.

Description

The list of digital assets is expansive. Cryptocurrency is likely the first to come to mind but also included are social media accounts, cash apps, NFTs, and gaming accounts. Virtually everything accessible by a computer, tablet, or smartphone is a digital asset. The value of these digital assets is often underestimated. Taxpayers hold thousands of different cryptocurrencies, and a single social media account can be valuable. An estate plan should include digital assets that may have value at death.

Most states have adopted the RUFADAA rules. RUFADAA allows fiduciaries the right to access a taxpayer's digital assets at the death or incapacity of its owner. An individual may decide to grant fiduciary access to only certain digital assets. Terms of Service Agreements (TOSAs) govern access to digital assets. Users often agree to TOSAs without reading them when setting up an online account. Most state that the account is only accessible by a user during the user's lifetime. When individuals do not document their wishes by will or otherwise, fiduciaries, including executors, can find these digital accounts inaccessible.

Listen as our transfer tax expert provides trust and estate practitioners an understanding of the components of RUFADAA, and differences in non-RUFADAA states, to properly prepare clients to pass on digital assets.

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Outline

  1. Revised Uniform Fiduciary Access to Digital Assets (RUFADAA)
    1. States that have adopted RUFADAA
    2. State differences in interpretation of RUFADAA
    3. States that have not adopted RUFADAA
  2. What are digital assets?
  3. Granting fiduciary rights
    1. Terms of Service agreements
    2. Online tools
    3. Wills, trusts, and other documents
  4. Identification
    1. Inventory
    2. Passwords
  5. Specific assets
    1. Cryptocurrency
    2. PayPal, Venmo, and cash apps
    3. Facebook, Instagram, LinkedIn, and other social media
    4. Other specific assets
  6. Best practices

Benefits

The panel will review these and other critical issues:

  • How fiduciary access to digital assets is handled in non-RUFADAA states
  • Key RUFADAA interpretation differences in adopting states
  • Steps estate tax professionals should advise clients to take to streamline the transfer of digital assets
  • What is a digital asset, and which critical digital assets might be overlooked in estate plans?

Faculty

Ploss, I. Richard
I. Richard Ploss
Counsel
Porzio, Bromberg & Newman

Mr. Ploss is a member of the firm's Trusts and Estates Department. He concentrates his practice primarily on...  |  Read More