“Intellectual property such as artistic endeavors, designs, symbols, names and images, has a value that is part of an estate plan. These assets are often registered and protected through patents, trademarks and copyrights.”
If your income stream includes royalties from intellectual property, you definitely want to make sure that you include comprehensive information about these assets in your estate plan, says the Times Herald-Record in the article “Include intellectual property and royalties in your estate plan.”
Just as any other asset, intellectual property rights and royalties can be transferred to a living trust to avoid going through probate. By using a trust rather than a will for these types of assets, you avoid the costs and delays of the probate process.
Another advantage of placing assets in a trust is that their value, the names of beneficiaries, and their inheritance amounts are not public and available to the individuals who comb these records seeking information. The average person isn’t devoting time to searching probate records. A sales person or scammer is more likely to be digging into these personal details.
Depending on the nature and value of the intellectual property or royalties, privacy alone may be reason enough to place these items in a trust.
Like digital assets, intellectual property and royalties are frequently left out of estate plans. If ignored, serious financial issues can be created. If a will is used, the intellectual property is part of the probate proceeding with the beneficiaries named and the values stated.
For the heirs of those who fail to create a will or place property in a trust, the headaches are bigger. In that case, the assets go through an administrative proceeding, under the laws of “intestacy,” or dying without a will. If you die without a will, assets go to the spouse and children, about half and half. If there is no spouse and no children, assets go to parents. If parents have already passed, then assets are distributed to siblings. If a sibling has died, the sibling’s share goes to his or her children.
The joke about people who die without a will, is that they do have a will; it’s just not the one that they may have wanted.
If you are a creative individual whose body of work includes things like music, art work, fiction or non-fiction, or own any patents or trademarks, do a complete audit of your intellectual property and discuss how it should be integrated into your estate plan with your attorney.
Reference: Times Herald-Record (Oct. 6, 2018) “Include intellectual property and royalties in your estate plan”