Durable Power of Attorney
Thursday, 3 March 2016
by Erin McAllister, Paralegal
A durable power of attorney is an essential part of any estate plan. People often use durable powers of attorney to appoint someone to handle their financial affairs if they become incapacitated and unable to make sound financial decisions for themselves. The person authorized to make decisions is known as the Attorney-in-Fact. The party who is authorizing the agent or attorney is referred to as the Principal. The Principal must make their determination of who they want to act as their Attorney-in-Fact when he/she has the soundness of mind and an intelligent understanding and perception of one’s actions. In other words, a durable power of attorney is created by a person who wants to choose the person to make financial decisions for them once they become incapacitated and cannot make those decisions for themselves. A durable power of attorney must be in writing, be dated and signed before a notary public.
The Attorney-in-Fact must be 18 years or older. Your Attorney-in-Fact has a fiduciary obligation to act in your best interest and avoid gaining a personal benefit at your expense. You should be very careful when choosing your Attorney-in-Fact. It should be someone you trust and feel confident that they can and will handle your financial decisions for you. Before you name someone as your Attorney-in-Fact, you should talk to that person and get his or her consent. The person you choose as your Attorney-in-Fact should know that he or she has a duty of trust and must always act in your best interests. You can also name an alternate Attorney-in-Fact to act for you if your first choice cannot.
Once a person is considered incapacitated and unable to make decisions for themselves, they can no longer create a power of attorney. An interested person must go to court and attempt to get a guardian or conservator appointed to take care of the incapacitated person and their finances. The decision is taken out of the hands of the incapacitated person and their wishes may not be known or followed. This process requires patience as the process of going through the courts is more difficult, costly and lengthy.
A durable power of attorney usually lists specific powers that are granted to the Attorney-in-Fact. For estate planning purposes, the following powers are often included:
1. Medical Care. To arrange for medical, surgical, hospital, nursing and convalescent care and treatment that is subject to any advance healthcare directive.
2. Collection. To oversee collection of any funds or properties that may be made payable to the Principal.
3. Payment. To make payments on behalf of Principal.
4. Banking. To sign, endorse, deposit, withdraw, purchase, or redeem.
5. Purchase and Sale. To purchase, acquire, lease, exchange, sell and transfer any property of the Principal.
6. Tax Matters. To prepare, sign and file tax returns and any other documents as needed.
7. Agents. To hire and dismiss agents to act for the Attorney-in-Fact in Principal’s behalf.
8. Receipts. To execute all instruments in connection the financial responsibilities for the Principal.
9. Gifts and Estate Planning. To make gifts and to continue the estate planning that Principal had commenced prior to becoming incapacitated.
This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.
The Attorney-in-Fact must be 18 years or older. Your Attorney-in-Fact has a fiduciary obligation to act in your best interest and avoid gaining a personal benefit at your expense. You should be very careful when choosing your Attorney-in-Fact. It should be someone you trust and feel confident that they can and will handle your financial decisions for you. Before you name someone as your Attorney-in-Fact, you should talk to that person and get his or her consent. The person you choose as your Attorney-in-Fact should know that he or she has a duty of trust and must always act in your best interests. You can also name an alternate Attorney-in-Fact to act for you if your first choice cannot.
Once a person is considered incapacitated and unable to make decisions for themselves, they can no longer create a power of attorney. An interested person must go to court and attempt to get a guardian or conservator appointed to take care of the incapacitated person and their finances. The decision is taken out of the hands of the incapacitated person and their wishes may not be known or followed. This process requires patience as the process of going through the courts is more difficult, costly and lengthy.
A durable power of attorney usually lists specific powers that are granted to the Attorney-in-Fact. For estate planning purposes, the following powers are often included:
1. Medical Care. To arrange for medical, surgical, hospital, nursing and convalescent care and treatment that is subject to any advance healthcare directive.
2. Collection. To oversee collection of any funds or properties that may be made payable to the Principal.
3. Payment. To make payments on behalf of Principal.
4. Banking. To sign, endorse, deposit, withdraw, purchase, or redeem.
5. Purchase and Sale. To purchase, acquire, lease, exchange, sell and transfer any property of the Principal.
6. Tax Matters. To prepare, sign and file tax returns and any other documents as needed.
7. Agents. To hire and dismiss agents to act for the Attorney-in-Fact in Principal’s behalf.
8. Receipts. To execute all instruments in connection the financial responsibilities for the Principal.
9. Gifts and Estate Planning. To make gifts and to continue the estate planning that Principal had commenced prior to becoming incapacitated.
This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.
