Estate & Trust Administration For Dummies, 2nd Edition
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If your decedent owned a computer or other electronic device, it’s an important resource for sorting out what the decedent owned. If the decedent and/or his estate planner were really on top of things, they’ll have included the digital estate in the estate plan. You can hope for a list of digital devices and their passwords, and a list of online accounts.

If no one thought to leave you this information, in most cases, the computer will probably give up its files fairly easily, but if the decedent was technically adept, you may have some difficulties in breaking through passwords and other safeguards. You may find it helpful to use someone who is computer savvy in order to get to the information you need.

Before you begin digging for files, make a complete backup of the hard drive, and of any loose disks, flash drives, CD-ROMs, or DVD-ROMs you find lying about that contain data. You want to be cautious about losing data, and making backups ensures that you have the information that was most current on the date of death.

The quickest way to back up any computer is to purchase an external hard drive, plug it in, and then use the software that comes with it to start backing up all the files located on the computer’s hard drive. You can also copy the contents of CD’s or DVD-ROMs, and flash or thumb drives to the external hard drive to give you a complete copy of the decedent’s files.

If you’re concerned about the cost of the external hard drive, don’t worry — it’s a valid expense of the estate (including the cost of a technician if you really don’t want to do the backup yourself), and you should pay it from estate funds, not from your own funds.

You may find nothing of value on the computer, or you may find the decedent’s entire financial life. As more people computerize their financial records and replace paper statements and bills with virtual equivalents, the computer may contain the only records of those bank and brokerage accounts.

On the computer, you can see evidence of sources of income as well as debts owed. You can probably even find copies of tax returns. In fact, you can often find everything on the computer that used to be kept in a well-organized file cabinet if only you take the time to look.

If your decedent left you a list of passwords to his e-mail accounts and social media accounts, you may feel that you’ve hit the jackpot, but be forewarned — the Terms of Service contracts on these accounts sometimes say that these accounts terminate on the user’s death, and some contracts say that the password may not be shared, and you may violate a state or federal law by using it.

The safer way to access these accounts is to provide the e-mail or other account service with certified copies of the decedent’s death certificate and your appointment as executor. Case law is still undecided, but you may receive access to the content of the accounts on that basis. Don’t forget, we’re in a whole new cyberworld here, and the law in this area is still developing.

On occasion, you’ll discover that you can’t find anything at all in the computer files, but you do have some disks that the computer can’t read. You need to judge whether you think you’ve reasonably uncovered all the assets through traditional methods, or if you have some gaping holes.

If you do have holes, and you can see evidence of financial software on the computer, you may want to consider having the corrupted disk restored through a restoration service. The cost can be substantial, but when you compare the cost to the benefit of finding a major asset that you would otherwise have missed, it’s reasonable. And remember, it’s an estate expense and fully deductible.

About This Article

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About the book authors:

Margaret Atkins Munro, EA, has more than 30 years of experience in trusts, estates, family tax, and small businesses. She lectures for the IRS annually at its volunteer tax preparer programs. Kathryn A. Murphy is an attorney with more than 20 years of experience administering estates and trusts and preparing estate and gift tax returns.

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