Legal documents, such as wills, can be a sensitive topic for many of us. Yet, we must plan them carefully to properly safeguard our family members’ inheritance successfully. For the vast majority of cryptocurrency or bitcoin owners, the last thing on our minds is what happens when we pass, let alone how inheriting cryptocurrency plays a part in our estate plans. However, just like your conventional assets, it’s critical to take control of your digital wallet. Considering the influence cryptocurrency might have on your estate taxes, preparing for this prior to your passing is a smart and effective way to plan your estate’s distribution.
Many examples have occurred in which a holder of cryptocurrency died unexpectedly, without proper protection. Because of this, there is no guarantee that their family or friends received any of the digital currency left behind. Instead, these assets are trapped in a bitcoin wallet, with little to no possibility of ever being accessed. In essence, these coins have as good as vanished. Making these units transferable while alive is a crucial step towards protecting your Blockchain products and safely ensuring your beneficiaries receive everything left to them.
What Makes Cryptocurrency Different?
Cryptocurrencies are different from other typical payment methods. Cryptocurrency is a peer-to-peer electronic currency system working on Blockchain. Unlike regular or “fiat” money, which is supported and regulated by the producing government, cryptocurrency is not regulated by any specific authority.
The main benefit is personal sovereignty — you have ultimate control over your finances. However, with this independence comes personal responsibility. There is a need to effectively secure your wealth via a proper estate plan with the assistance of an estate planning attorney familiar with cryptocurrency.
There are platforms available for people to secure their digital assets. These include providing wallet credentials, and digital copy with permission. This eases the entire process of passing on virtual currencies to family or other beneficiaries.
Ensure that your beneficiaries that will be inheriting your cryptocurrency know it is included in your estate plan. It is imperative that they know who they should contact when the time comes. This is a critical step toward protecting your cryptocurrency. Billions of dollars in bitcoin have been lost due to the unexpected death of its owner who had not prepared their heirs. With a proper estate plan established, one can make certain that their families are not only in the know but understand how to retrieve their gift.
Take the First Step Today
Since the future is unpredictable, it’s useful for your beneficiaries to grasp the fundamentals of bitcoin, vaults, and devices now. A few cryptocurrency exchange platforms have shared that many relatives attempt to retrieve a deceased’s digital assets but cannot do so due to security concerns and incomplete instructions. Include cryptocurrency in your trust and avoid the risk of loss.
Although the last thing your family wants to worry about when you are gone is your cryptocurrency. It’s important for them to receive the benefits of your legacy. To make this process as simple as possible, contact an estate planning attorney. This will save your beneficiaries time and stress figuring out the difference between “private” and “public” keys. Learn how to transfer cryptocurrency into your family trust and achieve peace of mind for you and your loved ones.