When Ben Franklin left over 400 diamonds to his daughter in his will over two hundred years ago, no one could imagine it might be setting a precedent for probate and estate planning in Texas in 2014. The Age of Technology is upon us, and it has affected every aspect of our lives, including the laws pertaining to inheritances, will planning and probate.
Today, divorce agreements often include digital and virtual assets. A digital asset might be an electronic book or piece of music, a movie, blog, Web site, domain name or other intangible wealth. Domain names belonging to Facebook or real estate may come with million dollar price tags. ICloud.com was purchased for $4 million under two years ago.
A virtual asset is different from a digital asset. Like digital assets, these are intangibles and have no physical form. Avatars, online possessions or even land on a virtual farm are considered virtual assets. They are a massive financial endeavor, enhanced by widely-popular online computer games with virtual players from all over the globe.
A recent study in Forbes magazine reports that virtual assets have limitless movement in the online world, which has translated into business transactions in the physical world. In the U.S. alone, virtual buying and selling is in the billions and growing. Purchases can be traded or converted to real dollars in the physical world.
Digital and virtual assets must be considered in a divorce, whether they are categorized as separate or community property. A court decision can determine community property, but separate property gets more complicated. An individual must be able to prove virtual or digital property is a separate item with an assigned value. Will planning in the 21st century has to include the distribution of digital or virtual assets to heirs and beneficiaries.
Ben Franklin could never have imagined how the times would change as he pondered passing on his diamonds to his next of kin. Now, more than ever, here in Texas or in other states, we must integrate sound estate planning in leaving assets to our beneficiaries. As the world changes around us, so do the laws surrounding the value we leave behind. It is in our best interests to keep up with these changes.
Source:Allen Publications, “WHAT!? My Spouse Can Get my iTunes and My Virtual Farm?” No author given, Mar. 21, 2014