Electronic signatures allow for simpler, quicker, and even more secure document signing. Businesses and consumers alike now have the flexibility to do business in ways that are easiest for them. Federal law in the United States has even recognized the importance of online signatures; the government passed legislation to make them legally binding.
With two digital signature acts (ESIGN and UETA) currently in place, here’s what you need to know about electronic signatures in the U.S.
ESIGN and UETA
ESIGN and UETA are two legal acts that protect digital signatures as legally binding and valid. Let’s take a look at the history of ESIGN and UETA.
Electronic Signatures in Global and National Commerce Act (ESIGN Act)
ESIGN (U.S. Electronic Signatures in Global and National Commerce) was established in 2000. This piece of legislation made electronic signatures legal in every U.S. state and territory where federal law applies. It puts digital signatures on the same level as handwritten signatures in terms of legality, which is a major win for businesses and consumers who would otherwise be burdened with the task of physically signing documents.
Under this act, an electronic signature is simply a specific mark or identifier that is associated with a document or other record and executed by someone with an explicit intent to sign the said record.
The ESIGN act validates digital signatures and creates additional legal protections. Any signature requirement under law can be satisfied with an electronic signature in states and territories where ESIGN applies. Additionally, electronic signatures may be presented in court as evidence and would hold up in a court of law as valid.
However, for an electronic signature to realize full legal protection under ESIGN, some components must be present. There needs to be a clear intent to sign the document, expressed consent to conduct business electronically, a clear option to opt-out of doing business electronically, and distribution and retention of the digital documents. Both the customer and the business should receive a copy of the digital signature for their records.
Uniform Electronic Transactions Act (UETA)
In some states and territories, the UETA (Uniform Electronic Transactions Act) is in effect. This law also holds that digital signatures are legally binding.
Established a year before ESIGN, UETA has been implemented by 49 states in the U.S. since 1999. It’s also been adopted in the District of Columbia, the U.S. Virgin Islands, and Puerto Rico. New York is the only state that has not adopted UETA, which we’ll cover later.
Similar to ESIGN, there are legal protections that come with UETA. Digital signatures are held as legal and binding, meaning documents cannot be denied simply because they were signed digitally.
Additionally, it mirrors ESIGN protections stating that if a signature is required by law, a digital signature may legally be used. It also includes protections for digital records as a whole, not just the signatures themselves. That means if the law requires a written record, a digital record would also satisfy the law under UETA.
There are a few types of documents that are exempt from UETA, such as wedding, birth, or death certificates, as well as wills and other estate documents.
Electronic Signature Laws By State
Electronic signature laws are generally consistent across all states, however, some states have additional or alternate laws. Let’s take a look at what electronic signature laws apply to each state in the United States.
|State||Electronic Signature Laws by State||E-Signature Legal?|
|Arizona||ESIGNUETAAETA (Arizona Electronic Transactions Act)||Yes|
|Nevada||ESIGNUETANETA (Nevada Electronic Transactions Act)||Yes|
|New York||ESIGNESRA (Electronic Signatures and Records Act)||Yes|
New York State Electronic Signature Laws
The Electronic Signatures and Records Act (ERSA) in New York provides similar legal protections to digital signatures in the state. The act gives digital signatures the same legal authority as handwritten signatures. This act was passed in 2000 and does exclude certain legal documents such as those related to a person’s property upon their death.
Start Using Legal E-Signatures With The Help Of Signaturely
Signaturely was designed with ease of use in mind. Setting up an account takes just minutes, creating or uploading your electronic signature is a breeze, and the platform allows for global collaboration and document sharing.
Now that you have an understanding of the various laws and regulations in the United States pertaining to digital signatures, you can see how valuable a platform like Signaturely can be. With every state having some form of digital signature protection, you no longer have to use physical, handwritten signatures and printed documents. Simply upload your document, click to sign, and send it along to others to have them sign right on the platform.
Not only are digital signatures just as legally valid as handwritten ones—opting for an electronic signature can save your business time and money. With Signaturely’s software, you can avoid expensive printing costs and equipment, and won’t need to pay for shipping to deliver your important documents.
Electronic Signature Law FAQ
Here are some top FAQs and answers to help you understand electronic signature laws by state.
Are electronic signatures valid in all states?
Whether through a federal act or a state-level act, electronic signatures are generally valid in all states. There are some exceptions to the rule, such as the type of document being signed. In most states, certain documents related to property, birth, marriage, and death certificates can only be signed with a handwritten signature.
What is the difference between ESIGN and UETA?
The primary difference between ESIGN and UETA is the level at which the acts were created. ESIGN is a federal digital signature act, whereas UETA is a state-level act that has been adopted by most states. Where federal law does not apply, which would include certain U.S. States and territories, ESIGN can’t be enforced. However, at the state or territory level, UETA can be enacted for digital signature protections.
Does the IRS allow electronic signatures?
The Internal Revenue Service (IRS) does allow for electronic signatures on all IRS-related documents, including federal tax returns. Tax software will include proper signature validation when filing.
A Recap Of Electronic Signature Laws By State
Electronic signatures are legal in all 50 states in the United States, however, it’s important to understand which specific acts and regulations protect those signatures in each state. While most states have both ESIGN and UETA protections, states like New York have opted for their own version of protections. Digital signatures are legally binding and valid, and with a platform like Signaturely, securely signing your documents has never been easier.