Power of Attorney

A Power of Attorney is your authorization, given to another person or organization, to act on your behalf while you’re unavailable or unable to do so. The person or organization you appoint is referred to as an “Attorney-in-Fact” or “Agent.”, Power of Attorney documents are commonly completed at the same time as the making of your Will and may be available as a part of a Last Will and Testament package deal from your lawyer.  An awareness of some of your options beforehand helps you make informed decisions.

There are several are several specific Powers of Attorney to choose from

General Power of Attorney – this document authorizes your Agent to act on your behalf in a variety of different situations. A general power of attorney is usually used to allow your agent to handle all of your affairs during a period of time when you are unable to do so. For example, when you are traveling out of the state or country or when you are physically or mentally unable to handle your affairs. A general power of attorney is frequently included as part of an estate plan to make sure that you have covered the possibility that you might need someone to handle your financial affairs if you are unable to do so. A general power of attorney is very broad and provides extensive powers to the person or organization you appoint as your agent. These powers usually include:

  • Handling transactions involving U.S. securities
  • Buying managing , or selling property
  • Purchasing life insurance
  • Settling claims
  • Entering into contracts
  • Filing tax returns
  • Handling matters related to government benefits
  • Maintaining and operating business interests
  • Employing professional assistance
  • Making gifts
  • Making transfers to revocable (“living”) trusts
  • Disclaiming interests

Special Power of Attorney – This document authorizes your Agent to act on your behalf in specific situations only. For example, you could authorize someone to sell a car or a house for you, or you may be unable to handle a specific situation because of other commitments, or health reasons.

Health Care Power of Attorney (Health Care Proxy) – This is a document that allows you to designate a person (an “Agent”) who will have the authority to make health care decisions on your behalf if you are unconscious, mentally incompetent, or otherwise unable to make such decisions. You may also express your wishes regarding whether you wish to receive “life-sustaining procedures” if you become permanently comatose or terminally ill. A Health Care Power of Attorney is different from a Living Will because it allows you to appoint someone to make health care decisions for you. A Living Will only allows you to express your wishes concerning life-sustaining procedures. Both Living Wills and Health Care Powers of Attorney are considered “Advance Health Care Directives” because you’re giving instructions on what you’d want to happen in the event that you become unable to make health care decisions in the future. Some states also have a specific “Advance Health Care Directive” document that combines elements of a Health Care Power of Attorney and a Living Will.

This document only becomes effective when you do not have the capacity to give, withdraw or withhold informed consent regarding your health care. You still have the right to give medical directions to physicians and other health care providers as long as you are able to do so,even if you have executed a Health Care Power of Attorney,

Durable Power of Attorney A durable or continuing general Power of Attorney is a document that grants another person the power to control your affairs as if they were you. It becomes effective immediately, and only ceases at the time of your death.  A durable or continuing General Power of Attorney is a very powerful document. However, a durable or continuing Power of Attorney is a useful thing to have on hand.  It means that the person named (usually your spouse or other immediate family member) may conduct all of your affairs as if they were you.  If you unexpectedly became incapable of making coherent decisions or even signing your own name.  Could anyone access your bank accounts and ensure that your obligations are paid on time or that your assets are protected?  Without a power of attorney in place, to gain access to your assets someone must petition a court to grant the right to administer your affairs, which can be a prohibitively costly procedure and time consuming.

Note: The general, special and health care powers of attorney can all be made “durable” by adding certain text to the document. This means that the document will remain in effect or take effect if you become mentally incompetent.

Revocation of Power of Attorney: A Power of Attorney can be revoked at any time by following the procedure specified by your jurisdiction.  By the same token, a person appointed to be a Power of Attorney might decline the appointment when the time comes, or having accepted, may become unable or unwilling to continue to act over a lengthy period of time.  For this reason it is prudent to appoint at least one alternate choice (successor).  Two or more individuals may be appointed jointly, meaning that they must act together and only if all parties are in agreement, or severally, meaning that each may act independently without the approval of the other.

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