Intellectual Property: Transferring Rights Through Your Estate Plan Estate Planning Jackie earns a good living from the popular novels she has written. She sometimes worries what will happen to her books when she passes away. After all, her copyrights were worth something, right? Jackie talked to her attorney, who suggested she include her intellectual property rights in her estate planning. The Ownership of Ideas Intellectual property (or IP) typically takes the form of patents, copyrights, trademarks, or service marks. It is sometimes defined as the “ownership of ideas.” Patents are government licenses giving some the exclusive right to an invention. Once granted by the U. S. Patent and Trademark Office, patents remain effective from 14-20 years. Copyrights relate to the exclusive rights granted to someone who creates an original work, like a painting or a book. While a copyright exists from the time a work is created, it is advisable to register your copyright with the U. S. Copyright Office. Trademarks are words, phrases, symbols, or designs that identify a company or distinguish their goods from other goods. Service marks are similar but identify and distinguish a service instead of a product. Trademarks and service marks can last indefinitely, as long as they continue to be in use. Intellectual property may continue to be valuable long after the owner has passed away. For example, copyrights for materials created after 1978 now last for the life of the author plus 70 years. The copyright laws for pre-1978 creations are more convoluted, but there still is a chance that copyright can generate money for your heirs long after you are gone. But are patents, copyrights, and trademarks considered to be assets? Any IP that you own is an asset that may become part of your estate assets. Like anything of value, this type of asset should be included in your estate plan. If the IP is not addressed in your Will or any trusts you have established, those rights will pass according to the intestate succession laws. This could prove costly, as the people who receive your IP assets may not know what to do with them. It’s important to address IP by choosing who will receive those rights. Fortunately, you can do that through your estate plan. It’s important, though, that your Will or trust correctly deal with those important IP assets. For example, your Will usually should provide details about your IP instead of just lumping it into your residual estate. Most IP can be transferred during your lifetime. However, such a transfer could cause gift tax issues. Depending on how the IP was transferred, you may lose control of your IP assets. Protect When legendary singer Prince died in 2016, his estate contained intellectual property rights estimated to be worth $300 million. He failed to leave a Will, though, and his estate has been in turmoil. If you have intellectual property rights, it makes sense to plan who will receive their benefit after you are gone. At Law Offices of John Mangan, P.A., we help clients build a solid plan for their estates, one that fits their circumstances. Please contact us at 772-324-9050 to schedule an appointment or fill out our Contact Form. We are located in Palm City, Florida, and serve clients in surrounding communities like Stuart, Hobe Sound, Port St. Lucie, and Jupiter, too.
