By Team Tomorrow
Published November 24, 2019
You probably haven’t thought about how cryptocurrencies are going to be handled in your estate planning when you pass. If you have holdings in crypto, you might have wondered what is the best way to pass these assets on to your heirs when that time comes, given the unique structure and mechanisms for transfer of bitcoin, ether, z-cash, miners, etc.
One of the best financial instruments to transfer these assets is a revocable living trust, because it offers benefits like privacy, providing for minor children and giving your heirs access to liquid assets to manage the estate – more on trust funds here. At Tomorrow, we’ve recently updated our inheritance app with the ability to include cryptocurrencies in your trust.
Using traditional methods of estate planning presents a few problems for crypto holders, primarily around privacy, security, and peace of mind. The biggest problem is that probate is a public process which makes all assets in your Will part of the public record. This means that anyone could learn the balance of the assets being passed on to your heirs. You may or may not want this information to be public, and it could make your family a target for hackers or other nefarious characters. One of the best ways to avoid making this information public through probate is to include these crypto assets in a revocable living trust.
In Tomorrow’s Inheritance app, we now allow you to enter your cryptocurrency as an investment asset, similar to a more traditional investment account. This means that your coins will be transferred into your revocable living trust upon the execution of your Will. The coins will then be in the Trust and subject to the responsibility of the trustee you named in the app.
Currently, this transfer of coins won’t happen automatically, you will still need to leave instructions with the executor of your Will, describing how to transfer these assets into your trust. While this is not ideal, Tomorrow Ideas strongly believes in asset security and we don’t want any access to your private keys that are required to transfer the coins. We believe these keys should remain in your control and be transferred to your heirs in a more personal way, perhaps in a letter that you store with your Will and Trust documents. One great example of a template to make this information available can be found here.
As always, we at Tomorrow are looking for ways to make it easier to set up your estate and save your heirs from inheriting a mess. This means constantly looking at the assets people have and making our app as useful to your specific situation as we can. Keep an eye on our blog in the future for posts about cryptocurrency and other product updates!
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