Are you drafting or revising your will and wondering about property types? You might be familiar with tangible property, or physical assets like cars, jewelry, or real estate. However, intangible property is another crucial aspect to consider. Intangible property doesn't have physical form, but it can hold significant value. It's essential to understand and include these assets in your will for a comprehensive estate plan.
Intangible property encompasses a wide array of assets, from intellectual property to investments and more. By categorizing and understanding these items, you can ensure they're disposed of according to your wishes. Let's dive into the details of intangible property in a will.
What is Intangible Property?
Intangible property refers to assets that lack physical substance but hold intrinsic value. These assets are often overlooked in estate planning due to their non-physical nature. However, they can be just as valuable, if not more, than tangible property. It's crucial to inventory and specifically mention these assets in your will.
Intangible property can be categorized into several types, each requiring unique attention and planning. The first category is:
Intellectual Property
Intellectual property consists of creations of the mind, such as patents, copyrights, trademarks, trade secrets, and proprietary knowledge. These assets can be incredibly valuable, especially for entrepreneurs, inventors, authors, and artists. For instance, a patent on a groundbreaking technology or a popular song copyright can generate significant income.
Identify and list each intellectual property asset in your will, and specify who you want to inherit or manage them post-death. Consider creating a separate schedule that details each asset, its value, and associated rights and licenses. This will ensure a smooth transition of ownership and minimizes potential disputes.
Financial Assets
Financial assets include investments, bank accounts, and retirement savings. These assets can vary, from stocks and bonds to cryptocurrency and mutual funds. Financial assets can be transferred through payable-on-death (POD) designations or beneficiary designations. However, these assets should also be specified in your will to avoid ambiguity.
Regularly review and update your beneficiary designations and ensure they align with your will. Keep your will and other estate planning documents current to reflect any changes in your financial assets. Consider using a pour-over will to catch any overlooked assets and direct them according to your wishes.
Remaining Intangible Property in a Will
Beyond intellectual property and financial assets, other intangible property can include:
Memberships and Subscriptions
Memberships in organizations, clubs, or periodical subscriptions can have both sentimental and monetary value. You can gift these through your will, or the executor can choose to cancel them and distribute the remaining funds to beneficiaries.
Some memberships or subscriptions, such as gym memberships, may not be transferable. In such cases, the executor can ensure the member's estate receives a prorated refund for the unused portion of the membership fee.
Goodwill and Stellar Reputation
While not directly transferable, a good reputation and accumulated goodwill can be preserved and enhanced by your heirs. Encourage responsible digital citizenship and online behavior among your beneficiaries to protect and maintain your name and standing.
Additionally, your will can establish guidelines for how you want your legacy represented. This could include specific instructions for handling your social media accounts, managing your online presence, or requesting that certain causes or charities be supported in your name.
Addressing intangible property in your will helps ensure that your entire estate is managed effectively and efficiently. By meticulously categorizing and bequeathing these valuable assets, you can create a clear and comprehensive guide for your heirs and executor.
Effective estate planning recognizes the significance of intangible property. As your life and assets evolve, it's essential to periodically review and update your will to reflect these changes. By addressing intangible property, you'll have peace of mind knowing that your wishes regarding these valuable assets will be carried out.