In 2016, we wrote about the new North Carolina digital assets law and what happens to social media and e-mail accounts when you pass away: https://www.jessonrainslaw.com/news--blog/what-happens-to-my-facebook-or-gmail-when-i-die
Digital assets are not really “assets” in the true sense that you own the property. Facebook and G-mail own the property, and you’re just using it. Ultimately, that account is controlled by whatever contract you sign (or “clicked”) when you signed up for the service. Despite including digital asset instructions in wills, trusts, and powers of attorney, loved ones are still having issues accessing or shutting down a deceased family member’s digital property.
One option is to provide the executor with all the passwords to these accounts so that the executor can access them upon death. If you do it the old fashioned way and write all your passwords down and store them in a safe (not taped on the wall next to the computer!), you have the responsibility of updating that list every time you change a password or add an account.
Instead of using pen and paper, consider using a digital password manager like LastPass or Dashlane. You can name an emergency contact (your executor) who will have access to your passwords in the event of death or incapacity. Additionally, by using a password manager, you don’t have to worry about updating them yourself; you are notified any time an account is compromised; the password managers create unique passwords for you that are less likely to be hacked; and you can change all the passwords with just a click of a button (and you don’t have to remember any of them).
Prices for these services range from $0 to $40 per year. You can even use them for business accounts!
Kelly was quoted in the May ABA Journal! She was asked to comment on a recent American Bar Association Formal Opinion pertaining to client confidentiality and blogging because she co-authored a Campbell Law Review article with Professor Jan Jacobowitz that was cited in the opinion (Formal Opinion 480)!
“An attorney’s duty of confidentiality to his client is a foundational component of the attorney-client relationship,” says Kelly Rains Jesson, an attorney in Charlotte, North Carolina, who co-authored a Campbell Law Review article cited in the ABA ethics opinion. “As the opinion advises, there is no doubt that attorneys need to be cautious about violating Rule 1.6 on social media when posting about a case without client consent, no matter the nature of or source of the information,” Jesson adds.
See the article here.
We encourage business owners to form formal business structures like Limited Liability Companies and Corporations in order to protect their personal assets from business debts and creditors. However, simply filing the Articles of Organization or Articles of Incorporation with the Secretary of State’s office is not enough. If you do not keep your business and personal finances and operations separate, a court could potentially find that, while there was an apparent separation of the two, in reality, the individual was using his or her business for their own personal affairs and order that the two are not really separate. If this happens, a court could satisfy a business debt or judgment with your own personal assets.
What can you do to avoid this? First, the easiest thing to do is to keep your finances separate. Open a business bank account and only use that account for business income and expenses. Do not pay for personal items out of this account, even if you’re going to reimburse yourself. Keep good records. Do not take liberties with categorizing something as a business expense when it’s really a personal expense. Use a trustworthy business accountant. It is not worth the risk of stretching your deductions to pay less taxes (if it’s not really a business expense) because you’re opening yourself up to personal liability. Second, sign all of your contracts as member of your LLC. Don’t sign them as you personally.
Third, if you own a corporation, you have to comply with the North Carolina Business Corporation Act. You are required to have bylaws, even if you are the sole owner. You are required to vote and install a Board of Directors. If you want to own your corporation, the board (which may just be comprised of you) needs to issue you shares so that there’s a record that you own the business and that you’re not simply just a director or the president of the business. Directors need to keep thorough records of annual meetings and need to vote on business decisions (even if it is just yourself voting). If you do not have robust corporate records, you risk having a creditor ask a court to “pierce the corporate veil” … meaning that a court may find you and your corporation one of the same, and you may be ordered to satisfy corporate debts and judgments with your personal assets, defeating one of the main purposes of owning a corporation. If you or someone you know on a business and you believe that the books and records need to be improved, please give us a call.
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