Bitcoin is an open-source payment method that uses peer-to-peer technology to allow individuals to exchange money without relying on centralized government, banks, or stringent oversight. While governments are starting to explore ways to regulate bitcoin transactions, the cryptocurrency movement has continued to grow, with more individuals exploring ways to obtain bitcoins and utilize them for the majority of their transactions. As bitcoin begins drawing the attention of average consumers and is embraced by celebrities like Ashton Kutcher, Jamie Foxx, and Roseanne Barr, finding ways to include bitcoin in estate planning is becoming a necessity.
One problem that occurs when a person who has a large number of digital accounts passes away is that it is easy for these accounts to be overlooked. Most family members, court administrators, and executors focus on tangible assets such as real estate or traditional accounts at financial institutions. Cryptocurrency may quickly be forgotten, especially if your loved ones are unfamiliar with bitcoin or unaware of the amount of cryptocurrency you own. Making a detailed list of all digital accounts and including them in your estate plan decreases the chances of valuable accounts being omitted from asset distribution.
Consider Digital Assets When Choosing an Executor
A person who has considerable digital financial assets needs to be careful when naming an executor. Whoever administers your estate must understand your assets in order to be able to properly manage them in the period of time following your passing but preceding asset distribution. Naming a spouse or child who has no understanding of cryptocurrency could lead to problems. Consider naming a family member or friend who can protect your bitcoin assets as an executor to make sure the value is preserved for your beneficiaries.
Leave Detailed Instructions in Your Will
Large and well-known websites like Facebook and Google have set procedures in place to handle how accounts are transferred after an individual passes away. Financial institutions allow account holders the opportunity to name beneficiaries and transfer assets immediately on death. At this point, cryptocurrencies like bitcoin do not have a standard way to securely transfer account ownership upon death. For that reason, you must be prepared to leave detailed instructions regarding who you want to have ownership of your accounts after you pass away or how you want your accounts divided. Do not rely on a third party to manage the transfer or assume that your assets will automatically be turned over to your spouse or children.
Work with an Attorney
When navigating the largely unregulated and constantly changing world of bitcoin, having an experienced estate planning lawyer on your side is crucial if you intend to include cryptocurrency in your will. The team at MMZ Law is here to assist you with the task of creating a valid estate plan that ensures your heirs will receive all of the assets you intend for them to have. Contact us today to schedule a consultation in our Claremont, California so that we can begin providing you with the estate planning help you need.
BROUGHT TO YOU BY:
MMZ LAW, A PROFESSIONAL CORPORATION
341 W. 1st St. Suite 100
Claremont, CA 91711
MARIVEL M. ZIALCITA is the founder of MMZ LAW, A Professional Corporation, where she practices in the areas of Elder Law – Medi-Cal Planning Asset Protection, Trust & Estate, Special Needs, Conservatorship, Trust Administration, & Probate. Ms. Zialcita is a frequent speaker on trust and estate matters and holds memberships in the State Bar of California, Trust and Estate Section, The San Bernardino County Bar Association, Wealth Counsel and Elder Counsel. She currently assists in the pro bono legal services program at the James L. Brulte Senior Center in Rancho Cucamonga, California. She is based in Claremont but assists clients throughout Southern California.
This information is educational information only and not legal advice.