A growing number of residents of Tennessee and the rest of the nation now own digital assets, and for some, these assets hold quite a bit of value. If you count yourself among them, you may want to give some thought to how you might incorporate them into your estate plan.
Per Barron’s, failing to make cryptocurrency, non-fungible tokens and other types of digital assets part of your estate plan may place these investments in jeopardy after your death. How might you want to go about incorporating digital currency into your estate plan?
Establish a paper trail
It is advisable that you keep highly detailed records about your digital assets and where and how to find them. If you fail to give anyone this information, it may lead to delays in terms of distributing your digital assets to beneficiaries. It could also cause you to lose the entire digital asset – and its value.
Grant fiduciary access to digital assets
Chances are, you are going to need someone to help manage your digital assets after your death, and a fiduciary who has specific experience in this area may prove especially helpful. This individual may be able to help you identify effective ways to transfer digital assets, such as by using revocable trusts or beneficiary designations.
Anticipate value and tax implications
Digital currency is volatile and its value may change quite a bit over time. There are also tax implications associated with owning and transferring digital assets. The more you understand tax implications and value fluctuations, the better.
While managing digital assets and making them part of your estate plan is not always easy, failing to do so could cause your beneficiaries to lose out on a potentially high-value asset.