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July 18, 2016 In Estate Planning

Digital Assets: Who can access my online accounts if I die?

Digital Assets: Who can access my online accounts if I die?

digital assets estate planning lawyerChances are, if you are reading this Blog Post, you own Digital Assets and have one or more online accounts.  As Estate Planning Lawyers, we continue to see changes in the law to address our increasingly tech-savvy culture. The use of electronic information has continued to play a larger role in the Estate Planning and Administration we do for our clients.

Have you ever thought about what might happen to your Facebook account if you died?  Who would get your iTunes library and how would they access it?

Tennessee Legislature Passes Revised Uniform Fiduciary Access to Digital Assets Act

The Tennessee legislature recently passed the Revised Uniform Fiduciary Access to Digital Assets Act (the “Act”), which became effective July 1, 2016. The intent of the Act is to aid in a Fiduciary’s ability to access an individual’s Digital Assets.  A Fiduciary is someone either appointed by a person or a Probate Court Court to act on behalf of the person in the event of incapacity or death.  A fiduciary may be appointed by a person in a Power of Attorney or Last Will and Testament, or by a Court in a guardianship, conservatorship, or intestate estate proceeding.  The Act also attempts to protect a person’s privacy, as it also allows the person to restrict a fiduciary’s access to digital assets, and provides additional safeguards by allowing the Custodian of the asset to request certain documentation before providing requested information. A fiduciary granted access to digital assets is held to a fiduciary standard under the Act, requiring the fiduciary to act in the best interests of the person with a duty of care, loyalty and confidentiality.

What are Digital Assets?

The Act defines Digital Assets as “an electronic record in which an individual has a right or interest,” and this “does not include an underlying asset or liability unless the asset or liability is itself an electronic record.”  The Act does not necessarily grant the fiduciary access to a person’s cell phone, computer, tablet, etc., but this class of assets includes a wide variety of items, including:

  • assets from Twitter and Facebook accounts
  • assets such as PayPal accounts
  • iTunes accounts
  • Accumulated frequent flyer miles
  • Online banking or trading accounts.

How is Access Granted?

The Act lays out specific requirements as to how the fiduciary must go about requesting access to the digital assets depending on the nature of the fiduciary representation, the type of document (if any) granting the fiduciary the authority to access digital assets, and the depth of the information needed by the fiduciary.

What Should I do about my digital assets and online accounts?

Granting a fiduciary the authority to access your digital assets (or limiting their access) should be done with specificity.   You can and should address these issues in your Last Will and Testament and Power of Attorney.  You should also make sure that any usernames, passwords, and account numbers for your digital assets and online accounts are in a safe place so that your fiduciary can get this information and provide it if requested by a custodian (such as the bank, Facebook, etc.).

If you are concerned about your appointed fiduciary’s current potential access to your digital assets, you should consult with an attorney experienced in fiduciary matters, who can review the relevant documents and properly advise you about your specific situation.

What if I need access to someone else’s online accounts?

If you are currently in a fiduciary position and you need to obtain access to that person’s digital assets or records or online accounts, please be sure to consult with an estate planning attorney to find out how you should go about obtaining this information/access, because the procedures can differ based on your fiduciary role, the powers you have been granted, and the type of information you are trying to obtain.

Let us help you

Our Estate Planning Attorneys can help develop a digital assets plan to best suit your individual needs.  Visit our website to learn more about our work and call us today at 901-372-5003.

June 13, 2016 In Estate Planning

Don’t be like Prince: Get a Will.

prince died without a will, memphis estate probate lawyer

Learning from Prince’s Mistake

It’s been widely reported that Prince probably died without a Will. This has left many people wondering:

How could someone rich and famous like Prince die without a Will?

Unfortunately, it is not uncommon for people, even the super-wealthy, to to die without even the simplest form of an Estate Plan. While at least one source reports that Prince’s Estate may be worth less than what people think, this surprising omission of someone of Prince’s celebrity status should give us all cause to stop and think about what might happen to our own families and hard-earned assets in the event of an untimely death.

2 Simple Reasons to Have a Will or Estate Plan

When we meet with potential clients and give basic estate planning seminars, we stress the importance of having, at the very least, a basic estate plan in place. This is important because:

1. Your wishes will be known. Have you ever tried to guess what another person wants? This is why many of us find Christmas shopping very stressful. The only way you can be sure to “get what you want” is to properly (and legally) communicate your wishes and desires. Just telling someone won’t cut it. After all, neither a judge nor your family will be able to ask you after your death.

2. You can help prevent family feuds and division. You may think your family is so tightknit that they would never quarrel over your assets after you die. You may be right, but you may also be wrong. Why take the chance? Make your wishes so clear that your family members have nothing to fight about amongst themselves after your death.

An Estate Plan is important regardless of your financial status. You do not have to be “rich” to need a Will. Even if you think you don’t have enough assets to justify planning ahead, it is likely that your possessions have real meaning to family members or friends. It is also likely that you have a larger Estate than you may realize.

2 Simple Reasons People Don’t Have a Will or Estate Plan

1. Fear of Losing or Giving up Control. Like Prince, many people like to retain complete control over their assets and business affairs. There’s not a thing in the world wrong with this. However, having an Estate Plan does not mean that you lose control! In fact, Estate Planning is a way to extend the control over your affairs “beyond the grave.”

2. Death is an Unpleasant and Uncertain Event. People often put off any planning or do not want to think about their passing. It is easy to procrastinate and it always seems like planning can be left for another today. However, death is an unfortunate reality for us all. As Benjamin Franklin once said, “In this world nothing can be said to be certain, except death and taxes.”

What happens without a Will?

If you don’t have an Estate Plan or Will, in Memphis and Nashville Tennessee, your Estate, like Prince’s, may become subject to state law and Probate Court orders. This is likely to lead to familial dissension and excessive fees and costs for the Estate, which in the end reduces the amount of assets remaining for your Beneficiaries. Your money may also wind up going to the Government! For example, in Prince’s case, the Probate Court has appointed a Corporate Executor for his Estate, and many attorneys will be involved because of the number of potential Beneficiaries. There will be many questions as to how the royalties and future earnings from Prince’s music will be handled. Estate taxes will have to be paid. All of these factors will lead to a lot of money being spent (and some might even say “wasted”). All of the headaches and money spent, as well as the publicity involved, could have been avoided, or at least minimized, if Prince had planned ahead by having a Will or Estate Plan.

Moral of the Story:  Don’t be like Prince.

Don’t be like Prince. Plan ahead now! Having an Estate Plan is easy, and every person can and should have one in place. A basic plan can be relatively inexpensive, even if drafted by a licensed Tennessee estate planning attorney, like the ones at Patterson Bray.  We have offices in Memphis and Nashville. In Tennessee, and some other states, it is also possible, although often not recommended, for a handwritten Will to be valid. To read our blog post about handwritten wills, CLICK HERE.

Need a Tennessee Estate Planning Lawyer?

Call Patterson Bray if you’re in the Memphis or Nashville area at 901-372-5003 or email us here.

March 23, 2016 In Estate Planning, General

Can I Write My Own Will? Is a Handwritten Will Valid?

handwritten will, holographic will, probate lawyerIn some cases, a handwritten Will can be considered valid and admitted to Probate Court.  Under Tennessee law, a handwritten Will is called a “Holographic Will.”  It is not necessary that the document be witnessed, but all the material provisions and the signature must be in the Testator’s handwriting.

What does “Testator” Mean?

The testator is the person who is making the Will.

How Do You Prove a Valid Handwritten Will?

The Testator’s handwriting must be proven by 2 witnesses.  Before petitioning the Probate Judge to admit the document to Probate Court as a valid Last Will and Testament, the Executor will likely have to find 2 people who can testify that the material provisions and signature are in fact written in the Testator’s handwriting.

Why We Don’t Advise Handwritten Wills

While writing your own Will seems like a simple solution to making sure your assets go where you want them to go after your death, there are many pitfalls. For example:

  • You may mistakenly believe that the disposition of certain assets will be governed by the terms of your handwritten Will.
  • A handwritten document is more easily lost.
  • A handwritten Will requires additional proof to be admitted to Probate Court.
  • When you handwrite a Will, you are likely to amend or rewrite that Will in the future.  You are more likely to leave multiple handwritten documents that contain conflicting provisions.
  • Pertinent provisions may be left out of a handwritten Will, including provisions relating to the disposition of assets or provisions that may ease the burden of administrating the Estate.
  • Many handwritten Wills are not properly executed and are unable to be admitted to Probate Court.

A Will drafted by a Probate Lawyer is likely to more clearly convey your wishes so that it can be correctly interpreted by your Executor and the Probate Court Judge after your death.

Need a Will? Call a Probate Lawyer.

If you would like to speak with a Probate Lawyer about a Will or about how to make sure your wishes are carried out after your death, give us a call at 901-372-5003 or email us today. With offices in Memphis and Nashville, you can also visit our website to learn more about our attorneys and the work that we do for our clients.

March 9, 2016 In Estate Planning, General

What does my spouse get when I die? Ask the Probate Lawyer.

What does my spouse get when I die? Ask the Probate Lawyer.

will for spouse, ask probate lawyerMany people believe that if you die without a will, that everything passes to your surviving spouse. Did you know that is not necessarily true? Read on to learn more from a probate lawyer about what a surviving spouse is entitled to in Tennessee.

If you die WITHOUT a Will

If you die without a Will, the distribution of your assets will be governed by the Tennessee laws of intestate succession.  If you die “intestate,” it means that you die without leaving a Will. This is what will happen if you die without a Will:

  • If you have a surviving spouse, he or she will receive your entire Estate if you had no descendants at the time of your death.
  • If you are survived by descendants, your spouse is entitled to either (a) one-third (1/3) of your estate, or (b) a child’s share, whichever is greater.

If you die WITH a Will

Even if you die with a Will that does not include your spouse, he or she will still be entitled to a portion of your assets. Your surviving spouse may take what it called an “Elective Share” against your Estate, which is based on the length of the marriage.  There is a sliding scale, but the maximum Elective Share a surviving spouse can take is forty percent (40%) of the net Estate if the couple was married nine (9) years or more.

You Cannot Disinherit Your Spouse in Tennessee

Whether you die with or without a Will, in all but a few rare cases, your spouse will be entitled to a portion of your Estate. Generally, you must be legally divorced from your spouse in order to prevent that person from receiving a share of your Estate.

Other Allowances for Spouses

Other allowances for surviving spouses (which may also apply to minor children) include a $50,000 exemption for personal property, a reasonable allowance for a year’s worth of support according to the previous standard of living, and either the right to the homestead or $5,000 from the proceeds of the sale of the home.  In some cases, a surviving spouse might be entitled to certain accounts of less than $10,000 or wages due to the decedent if no formal probate estate is opened.

Need a Will? Need a Probate Lawyer? 

Please contact Patterson Bray at 901-372-5003 or email us here if you have questions about leaving a Will, Estate Planning, or Probate issues.  We have a team of lawyers ready to help you.

 

named estate representative of will
February 25, 2016 In Estate Planning

Ask the Probate Lawyer: What to do if you’re named as Executor in a Will.

Ask the Probate Lawyer: What to do if you’re named as Executor in a Will.

Probate Lawyer for Personal Representative of Estate

If you’ve been designated to serve as the Personal Representative (sometimes also called Executor or Executrix) in a Will, you will need to hire a Probate Lawyer to handle the Estate in Probate Court. Don’t worry: the attorney fees charged by the Probate Lawyer will typically come out of the funds of the Estate, not from your own personal assets.

Once you’ve hired a Probate Lawyer, you’ll meet with the attorney and begin to gather all pertinent information. The attorney will prepare and file documents to petition the Probate Court to admit the deceased person’s Will for probate administration.

Can’t I just handle the business of the Estate Myself?

No.  In Tennessee, the administration of an Estate must be done with the assistance of a licensed  attorney. Many people mistakenly believe that if you are named as the Personal Representative in a Will, then you only need a copy of the Will and an I.D. to conduct business on behalf of the deceased person or the Estate, but this is not correct. To legally transact business on behalf of the Estate, you must be officially appointed by the Probate Court and present the proper authorization.

Do I have to go to Probate Court?

Yes, if the deceased person had assets or accounts that do not have a joint owner or a beneficiary named. You will have to go to Probate Court with the attorney to prove the Will and to be officially appointed by the Probate Judge as the Personal Representative of the Estate.  At this court appearance, the attorney will address the judge and you will be asked certain questions about the deceased person and the Will.  The Probate Judge will then review the Will and the proof and decide whether or not to admit the Will for probate. If the Will is admitted, you, as the Personal Representative, will then be sworn in as a fiduciary, and you will be issued “Letters Testamentary” or “Letters of Administration,” which will allow you to legally conduct business on behalf of the Estate.

Required Steps in Probate Administration

Once the Estate has been opened and you’ve been officially appointed to serve, you will complete the following required steps with the help of your Probate Lawyer:

(1)   Establish a separate bank account for the Estate;

(2)   Give notice to beneficiaries of the opening of the Estate;

(3)   Give notice to creditors and TennCare of the opening of the estate;

(4)   File affidavits regarding notice to beneficiaries and TennCare;

(5)   File annual accountings and inventories; and

(6)   Collect the deceased person’s assets and distribute them amongst the beneficiaries. 

Do I Get Paid for the Time and Expenses I Incur While Serving as a Personal Representative? 

Yes. A Personal Representative is entitled to reimbursement of expenses that he or she personally incurs in administering the Estate. A Personal Representative is entitled to a reasonable fee at the conclusion of the administration of the estate. However, the position is truly more of a responsibility than a profitable endeavor. There is a significant amount of work for the Personal Representative to do. The amount of the fee depends on a number of factors, which the Probate Lawyer will discuss with you. 

How long does the Probate Process take?

An Estate must remain open for a minimum of 4 months to allow creditors time to file any claims.  On average, it has been our experience that 6-9 months is a reasonable estimate of the time it takes to conclude the administration of an Estate if everything is straightforward.  In some cases, it can take 12-15 months.  If an Estate takes longer than 15 months to administer, it generally means that there has been a problem that has arisen during the process, such as a tax problem, a will contest, or even the presentation of an unknown heir.

Let us be your Probate Lawyer. We can help. 

Call us at 901-372-5003 if you need help. If you hire us, we’ll walk you through the entire process and do our best to make your job as Personal Representative as easy for you as possible. We handle probate cases throughout Tennessee and Mississippi, including in Shelby County, Memphis, Bartlett, Arlington, Germantown, and Cordova.

 

January 27, 2016 In Estate Planning

Estate Planning And Divorce

estate planning lawyer, probate lawyer

Estate Planning And Divorce

Let’s talk about Estate Planning and Divorce. Will a divorce affect your Will? Over the years, many people have asked us about how a divorce will affect a Will or Estate Plan. Sometimes the question comes out of curiosity, and at other times, the person asking has just gone through a divorce. The best time to review or establish an estate plan is after the occurrence of a major life event.  In fact, these are often the only times many people even think about estate planning.

Major life events may include marriage, the birth of a child, or the death of a family member. Unfortunately, divorce is also a major life.

Beneficiary and Executor Designations

Typically, married couples have their estate plans drafted at the same time, and the terms of each plan are very similar. More often than not, one spouse has named the other as the executor of his or her Estate, as well as the sole beneficiary of his or her Estate.  While  Tennessee law contains a statute that essentially disinherits a person’s spouse in the event of divorce, that statute does not affect beneficiary designations or the titling or re-titling of assets.  Therefore, we do not advise that you rely on this statute alone.

In addition to reviewing your Will and other estate planning documents after a divorce, it is also important to  review the ownership structure and beneficiary designations of any assets that will not pass under the terms of your Will, such as retirement plans or life insurance policies.  Many assets, such as these, do not pass pursuant to the terms of a person’s Will, but rather will be distributed according to beneficiary designations.

Legal Guardians for Minor Children

In Tennessee, the only way to designate a legal guardian for a minor child in the event that something should happen to you is under the terms of your Will.   The person you choose to designate as the guardian of your child while you are married may greatly differ from whom you would select to fulfill the role after a divorce.

Let us help you with Estate Planning and Divorce Issues

As you can see, it is extremely important to undergo a comprehensive review of your assets and estate plan in the event of a divorce. If you have recently experienced a divorce or other major life event, or if you would like us to create or review an estate plan for you, please call us at 901-372-5003. We’re ready to help you.

November 15, 2011 In Estate Planning

Who are my Beneficiaries? A critical question in planning for the future.

beneficiary designations estate planning lawyer

How does Property Pass to Beneficiaries?

Do you know who your beneficiaries are? When we ask clients this question, their first response is often quick and affirmative. However, we frequently discover through the estate planning process that the beneficiaries listed on our clients’ life insurance policies and retirement accounts are not who they think they are, nor are they the intended recipients of the property.

One of the most common misconceptions we see is how property passes at someone’s death.  Accounts that have beneficiary designations  pass to the beneficiary or beneficiaries named on the beneficiary designation form for that account regardless of what your will or trust says.  So, for example, if my Will says that everything passes to my spouse at my death, but my beneficiary form on my life insurance names my children as beneficiaries, my life insurance proceeds  pass to my children and not to my spouse. Here are some examples of accounts that typically designate beneficiaries:

  • life insurance
  • retirement accounts
  • transfer on death accounts (TOD)
  • payable on death accounts (POD)

Periodically Review Your Beneficiary Designations

The  Supreme Court case of Kennedy v. Plan Administrator of DuPont highlights the unintended results that may occur if your beneficiary designations are not reviewed periodically.  In this case, William Kennedy named his wife, Liv, as the sole beneficiary of his pension and retirement savings plans at DuPont.  When the couple later divorced, the Qualified Domestic Relations Order (QDRO) provided that Liv gave up her rights to receive any benefits from William’s pension and retirement plan.  Unfortunately, however, the court order was never submitted to DuPont and the beneficiary was never changed.  When William later died, DuPont paid out the plan benefits to his ex-wife, Liv.  Their daughter, Keri, was appointed as Executor of William’s Estate and filed suit claiming that the Estate should receive his retirement benefits because the QDRO clearly provided that Liv had waived any interest she might have in those benefits.  The Supreme Court upheld the ruling of the Circuit Court in saying that DuPont properly paid the benefits to Liv and that Liv was entitled to the pension and retirement funds even though the parties were not married at the time of William’s death and the QDRO clearly provided otherwise.

Moral of the Story

The moral to the story is that the beneficiary designation governs. Thus, it is very important that you know who is named on your various beneficiary forms so that your property goes to the beneficiary or beneficiaries that you intend for it to go to.  It is clear that William did not intend for his benefits to go to his ex-wife instead of his daughter, but the Supreme Court held that the beneficiary designation governed and that DuPont properly paid the benefits to Liv.

Tips for Beneficiary Designation Forms

Here are some tips and common problems to watch out for with your beneficiary designation forms:

1. Do you know where the form is? Generally, employers maintain records of the form, but if they cannot find their form when the time comes, the burden may be on you to produce a copy of the form.

2. Is the form up to date? Changes in your life may require you to review the forms periodically. If you have had a recent marriage, divorce, birth or death in your family, it is important to review your beneficiary designations. And remember, your Will does not change who the beneficiary is on an account or insurance policy.

3. Do you have a contingent beneficiary named? If the beneficiary you have named dies before you or is involved in a common accident with you, you may not know who the benefits will go to if you do not name a contingent or secondary beneficiary.

4. Have you named a minor as a beneficiary? Minors cannot legally hold title to property, including these benefits. If you have named a minor, a guardianship may have to be established and administered through the Probate Court concerning applicable funds.

Want to talk it over with an Estate Planning and Probate Lawyer?

If you have questions regarding your beneficiary designations and how they factor into your Estate Plan, please call us at 901-372-5003 or email us today. We’re ready to help you plan for the future.

 

November 1, 2011 In Estate Planning

Is Tennessee a Community Property State for Estate Planning?

community property, estate planning lawyer tennessee memphis

Tennessee is NOT a Community Property State

Community property states such as California and Texas, permit assets to receive a step-up in basis to the current fair market value (FMV) at the death of the first spouse to die regardless of which spouse owns the assets.

Tennessee is a separate property state. This means that only the separate assets of the deceased spouse (titled in his or her name), or 1/2  of any jointly-owned property,  are entitled to a step-up in basis to the current FMV at the death of the first spouse to die.

Tennessee Community Property Act of 2010

But wait—this Act allows for ownership of assets in a Tennessee Community Property Trust.  Although this type of ownership of assets between a husband and wife is not always beneficial, it can provide a significant advantage in the right circumstances, especially for property with a very low tax basis.Provided the Trust meets certain requirements, the property owned by the Trust will be treated as community property.

Advantage

The most significant advantage of this type of ownership is that both spouses’ interests receive a step-up in basis up to the FMV of the property upon the death of the first spouse.  In contrast, if the property was owned jointly or as tenants by the entireties, only 1/2 of the property would receive a step-up in basis at the first death. Thus, community property ownership can significantly reduce or even eliminate capital gains upon the death of a spouse.

We can advise you further.

Call us today at 901-372-5003 or email us here. We can talk with you about your assets and the best way to structure an Estate Plan that fits your family’s particular circumstances.

October 20, 2011 In Estate Planning

Capacity to Make a Will in Tennessee

capacity to make will, TN estate planning lawyer

Capacity to Make a Will in Tennessee

As an estate planning and probate lawyer, I’ve handled cases from time to time where a person’s capacity at the time he or she created a Will or Trust was an issue. The elderly have increasingly become targets for those looking to prey on their physical and/or mental weaknesses. Additionally, people are living longer, and Alzheimer’s and dementia are becoming more and more common. Given all these factors, it is likely to continue to be an issue, especially when a person of advanced age changes or attempts to change beneficiaries.

What is a Self-Proving Will?

In most cases, a Will prepared by a lawyer includes the statements of 2 witnesses and a notary so that the Will is what is referred to as “self-proving.”  If the Will is not self-proving, it must be “proven” after the person dies.  In any case where there are handwritten notations or the document is totally handwritten, capacity of the person making the Will must be established.

Standard for Testamentary Capacity to Execute a Will in Tennessee

The general standard in Tennessee for capacity to execute a Will or a Trust is that the Testator (i.e., the person leaving the Will) be “of sound mind and disposing memory.” A person who does not have the capacity to conduct general business transactions or to enter into a contract can still have the required testamentary capacity to execute a Will or Trust. Two key factors in determining whether this standard is met are that the person must understand (1) the nature and effect of the act, and (2) the extent of the property the person is seeking to dispose of.

Whether a person is “of sound mind and disposing memory” is easy to determine when he or she is at one end of the spectrum or the other. Unfortunately, capacity is often not an all-or-nothing deal but falls somewhere in between the two.  When a person whose capacity is questionable tries to make notes or create or modify a Will or Trust, it can be very hard to determine after the fact. Obviously, the opinion of the person’s physician is always preferable and can often help prevent questions later.

Without capacity to make or modify a Will, the person’s intent may not be able to be carried out, even if there is no question as to what he or she wanted or was attempting to accomplish.

Your Legacy is Too Important to Leave to Chance.

Proper execution of  testamentary documents (i.e., Will, Trust, etc.) can avoid confusion later after you die, which is why it is important to consult an attorney when planning for your beneficiaries. The goal of testamentary documents is to accomplish your goals and objectives. What a shame if your intentions are not fulfilled due to a legal technicality or because a document was not executed properly.

If you would like to learn more about planning for your estate, please call us at 901-372-5003 or visit the Estate Planning page on our website.