Including digital assets in your will is crucial because, like physical property, they hold value and require proper management after your passing. Without specific instructions in your estate plan, these assets may be distributed according to state intestacy laws. This can result in your digital property being inherited by someone you did not intend or becoming inaccessible entirely.
Failing to address digital assets can also create challenges for your heirs. Without clear guidance, they may struggle to access accounts or navigate legal and company policy restrictions. By including digital assets in your will, you simplify this process for your loved ones and ensure your wishes are honored, protecting both the value and the legacy of your digital property.
Keep reading to learn more about:
- One of the top assets people forget about when planning their estate – and how to avoid that from pushing you over the federal tax threshold.
- What you need to look for when choosing someone to help you manage your digital assets in an emergency.
- The real truth about the risks of online estate planning and using tools like ChatGPT to take a DIY approach.
What Are Digital Assets?
Digital assets are forms of online property or electronically stored information that you own. These assets can include:
- Social media accounts (e.g., Facebook, Instagram, )
- Email accounts
- Online financial tools like PayPal, Venmo, or online banking apps
- Websites, domain names, or blogs
- Cryptocurrencies (e.g., Bitcoin, Ethereum, Solana)
What Types Of Digital Assets Can I Include In My Texas Estate Plan?
In Texas, your estate plan can encompass a broad range of digital assets to ensure they are properly managed and transferred according to your wishes. These assets may include:
- Social Media Accounts
Platforms like Facebook or Instagram can hold sentimental or financial value, particularly if they are monetized or tied to a personal brand. - Cryptocurrency
Bitcoin, Ethereum, Solana, and other cryptocurrencies are valuable digital assets that should be accounted for in your estate plan due to their increasing worth. - Websites, Blogs, & Domain Names
If you own a website or domain name—especially one that generates income—it is essential to address them in your will or trust. - Email Accounts
Email accounts often contain important personal, financial, or business information. Providing access instructions ensures your executor or heirs can manage these accounts as needed. - Online Financial Accounts
Platforms like PayPal, Venmo, and similar services store funds that should be included in your estate plan for proper handling. - Subscription Services
Accounts such as Netflix, Hulu, or YouTube Premium may include billing information or recurring payments that need to be managed by your executor.
Including these digital assets in your estate plan ensures they are accessible and distributed according to your preferences. It also helps your heirs avoid complications with access or ownership, providing a smoother process during a difficult time.
Can My Digital Assets Be Taxed? How Does That Relate To My Estate Plan?
There are unique tax considerations when including digital assets in your estate plan. Understanding these implications is essential for minimizing liabilities and ensuring your estate is handled as intended. Here are some key points to consider:
- Transfer Taxes
Some digital assets may be subject to transfer taxes when passed to heirs, depending on the asset type and applicable tax laws at the time of transfer. - Cryptocurrency And Capital Gains
Cryptocurrencies like Bitcoin, Ethereum, or Solana are treated as property for tax purposes. Any gains realized during your lifetime are subject to capital gains taxes. Upon your passing, beneficiaries who sell inherited cryptocurrency may also be responsible for capital gains taxes based on the asset’s value at the time of sale. - Breaking The Federal Estate Tax Threshold
If your estate exceeds the federal estate tax exemption ($13.99 million in 2025), digital assets could contribute to pushing your estate over this limit. While Texas does not have a state estate tax, the federal estate tax could still apply depending on the overall value of your estate. - Revenue-Generating Digital Assets
Intellectual property, such as a monetized blog or YouTube channel, may continue to generate income after your death. This income would likely be taxable to your heirs, adding ongoing tax responsibilities.
To address these potential tax implications, it is crucial to include digital assets in your estate plan and work with both an estate planning attorney and a tax advisor.
Aurelio Garza of The Law Office of Aurelio Garza PLLC in Texas is highly experienced in estate planning and digital asset management. His acumen includes helping clients secure their online assets, from social media accounts to cryptocurrency, ensuring these are properly addressed in their wills. With his guidance, many have successfully protected their digital legacies, avoiding pitfalls like invalid wills and unexpected tax implications.
If you are ready to protect your digital assets for the future, reach out to schedule a Peace of Mind Planning Session with Aurelio Garza today.
What Should I Consider When Choosing Someone To Manage My Digital Assets?
Selecting the right person to manage your digital assets is a critical decision that requires thoughtful consideration. Here are key factors to keep in mind:
- Trustworthiness
The person should be someone you trust completely, as they will have access to sensitive and potentially valuable information. They need to handle your digital assets responsibly and honor your wishes. - Tech-Savviness
Managing digital assets requires a solid understanding of technology. From accessing social media accounts and email to handling cryptocurrencies or domain names, the person should be comfortable navigating digital platforms and maintaining security. - Financial Savviness
For assets like cryptocurrencies or income-generating accounts, the individual should understand financial and tax implications. They need to manage these assets efficiently and be prepared to address issues like capital gains or other taxes. - Responsibility & Organization
Digital assets often involve multiple accounts, passwords, and legal considerations. Choose someone detail-oriented and organized, who can keep track of various assets and handle them with care. - Alignment With Your Wishes
It is essential that the person understands and respects your intentions. Whether you want certain accounts closed, content preserved, or assets transferred, ensure they are willing and able to follow your instructions.
By selecting someone who meets these criteria, you can ensure your digital assets are managed effectively and in line with your wishes, providing peace of mind for both you and your loved ones.
A Cautionary Tale About DIY Estate Planning In The Online Age
Our firm once worked with a family whose loved one had created their own will without fully understanding the legal requirements to make it valid. Unfortunately, they failed to include the necessary witness signatures, which is a critical requirement for a will to be legally binding in most jurisdictions.
After their passing, the family discovered the will was unenforceable because it did not meet the legal standards. This led to significant challenges, as the estate was forced into intestate probate. As a result, instead of following the client’s stated wishes, the estate had to be distributed according to Texas’ intestacy laws, which dictate heirs based on legal relationships rather than personal intent.
The result was confusion and tension among family members, some of whom had expectations that clashed with the state’s distribution laws. While I was able to guide the family through the probate process and determination of heirship, the situation could not undo the complications and emotional stress caused by the invalid will.
This experience underscores the importance of having a properly drafted and executed plan in place. While lawyers cannot guarantee a particular outcome, seeking professional legal advice in creating your estate plan can help avoid unnecessary difficulties for your loved ones. Let this serve as a reminder of the risks associated with DIY estate planning—it is worth the investment to get it done right the first time.
Still Have Questions? Ready To Get Started?
For more information on Estate Planning With Digital Assets In Texas, a Peace of Mind Planning Session is your next best step. Get the information and legal answers you are seeking by calling (956) 513-1117 today.
Aurelio Garza of The Law Office of Aurelio Garza PLLC in Texas is highly experienced in estate planning and digital asset management. His acumen includes helping clients secure their online assets, from social media accounts to cryptocurrency, ensuring these are properly addressed in their wills. With his guidance, many have successfully protected their digital legacies, avoiding pitfalls like invalid wills and unexpected tax implications.
If you are ready to protect your digital assets for the future, reach out to schedule a Peace of Mind Planning Session with Aurelio Garza today.
