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Durable Power of Attorney: What you need to know.
A durable power of attorney is a legal document that allows you to designate someone else to make decisions on your behalf if you are not available or you become incapacitated. This can be an extremely helpful document to have in place, especially if you have young children or are elderly.
Everything You Need to Know About Durable Power of Attorney
If you’re in the legal realm, you can attest that there are a lot of documents that need signatures. This is especially true if you’re looking at estate planning documents and probate laws. One such document is called a durable power of attorney. It allows an individual to appoint someone else as their agent should they become incapacitated or no longer mentally competent. People must understand what it does and how it works before they decide whether or not they want one drawn up.
Here’s everything you need to know about durable powers of attorney.
What is a durable power of attorney?
A durable power of attorney is a power that can’t change unless the document is revoked, or the individual who signs over their power dies. Rarely this type of power of attorney expires. The power of attorney remains valid even if a person becomes incapacitated or loses mental capacity, which means they can no longer make decisions for themselves.
It allows someone else, called an agent, to make financial and legal decisions on behalf of another person, called the principal. This could be anything from paying bills and making investments to signing contracts and filing tax returns. This should all be done in the principal’s best interests.
How to get a durable power of attorney
Obtaining a durable power of attorney is relatively simple and cheap. By following the right protocol, you should be able to resign as an agent and appoint someone else in your place without too much hassle.
Here are the steps you should consider:
1) You need to be a chosen agent
When you’re a chosen agent, you contemplate the benefits of durable power of attorney. Once you’ve become an agent and your principal has given you full control over his or her affairs, you can resign as an agent at any time.
However, if your principal can’t choose an alternate representative before he or she becomes mentally incapacitated, then under the law, your resignation won’t be effective until after your principal dies. You’ll still be the power of attorney agent in charge of their financial affairs, estate planning needs, etc
2) Think critically before signing a deal
You can sign on behalf of your principal, but you must be able to think critically and make decisions that are in your principal’s best interest. This is why it’s so important for you to know your principal well. Because of this, the agent is usually a family member, adult child, or close friend. By knowing them, you’ll be able to figure out what they would want in a given situation, their legal information, and how they might react if presented with different options.
3) As the principal, reach out to your potential agent and discuss becoming attorney-in-fact
In many cases, this is discussed before issues like losing mobility and health complications become a reality. Having both a durable power of attorney and an advance directive, also called a living will, can make things easier for you in the future. Note, this is different from a last will and testament.
If you have a person that you trust completely in mind, you’ll want to discuss them becoming your attorney-in-fact. You should talk with him/her about it before signing any legal documents or power of attorney form. This way, both parties will know what they’re getting into before anything else happens.
4) Find a reliable successor agent
You might want to consider finding a successor agent who will take over for you if you’re unable to act. It’s also essential that you discuss with him/her their responsibilities as an agent so that there are no misunderstandings later on.
Also, it’s best to have more than one successor agent in case something happens to one of them. Having multiple successors can make things easier for everyone involved because they can work together to help each other during difficult times. This will help to not require court proceedings that take up a lot of time.
Also, you should choose someone trustworthy because they’ll be in charge of managing most of your affairs once you become incapacitated. The agent’s authority and general power will allow them to handle financial matters and make financial decisions. If anything goes wrong along the way, it’ll be up to them to fix it.
Creating a durable Power of Attorney
You should follow simple steps when creating a durable power of attorney form. This will help you when you area creating this type of document:
1) Gather essential documents and information
Look for free durable power of attorney forms online and gather all of your important documents. There are a lot of online sources that can help you with creating your power of attorney document. However, you should get a copy of the durable POA from an attorney or law firm so that you can have it reviewed by someone who knows what they’re doing, like a lawyer. Also, if you’re unsure about something, don’t hesitate to ask questions.
2) Fill out the legal document with a lawyer
You should fill out your POA form carefully and ensure you’re not missing anything. If you’re unsure about something, you should get a second opinion from a legal authority who knows what they’re doing. This way, you can avoid making mistakes in your document. Also, it’s best that you fill out everything as accurately as possible because if there are any errors in your document, it might be difficult for an attorney to help you fix them later on.
3) Sign the document
Almost every state, by law, requires you to sign your POA document or POA form before a notary public. It’s best that you make an appointment with a notary public and bring all of your essential documents with you. This way, everything will be ready when you meet with them.
Also, you should ask questions about signing your legal documents in front of a notary public because each state’s laws may be different. Some states require you to be physically present, while others allow you to do it remotely. In some cases, both parties need to be present, while other states only require one party.
4) Distribute copies of your document
Once you have signed your document, you should get a few copies. One copy should be given to an attorney, lawyer, and the power of attorney agent named by the principal, while another should be kept in a safe place so you can use it if something goes wrong.
It’s also best to hand out copies of POA forms to close friends and family members. This way, there’s a level of added protection, they’ll know what powers they have and will be able to take action on your behalf in case anything happens.
5) Review the POA Agreement with a Law Firm
If you want your durable power of attorney to be successful, it’s best that you review it with your attorney or lawyer who can give you legal or tax advice. This way, you’ll know what he or she expects from you and will be able to make sure that everything is taken care of accordingly. Also, if there are any issues regarding your power of attorney documents, they can be resolved right away so that everyone can benefit. The goal here is to make sure things go smoothly.
6) Give Notice to Your Attorney
The last step is giving notice to your attorney. This will let him or her know that you’re going to leave, so he or she can take over accordingly. It’s best that you tell them a few days in advance, just so they have enough time to prepare for everything. This way, things will go smoothly, and everyone involved should be happy with how things are working out. If there are any issues along the way, make sure you talk with your attorney or lawyer about it right away because there might be another solution available to you instead.
Does durable power of attorney give a person control over financial affairs?
When you have a durable power of attorney, a person is given control over the following:
1. Financial affairs
If you have a durable power of attorney, it can also be a durable financial power of attorney. Under financial POAs that person has financial power and can make financial decisions for you if something happens to you.
For example, if you’re in a car accident and become incapacitated, your durable power of attorney will be able to access your bank accounts and pay your bills. He or she can also invest in stocks and bonds on your behalf. They may also be able to sell property like a house or car on your behalf.
2. Legal affairs
Another thing that a durable power of attorney can do is take care of legal affairs. If you have a durable power of attorney, he or she can handle things like paying your bills, filing taxes, and handling any legal issues you may have. They will also be able to represent you in court proceedings if necessary.
The good thing about having a durable power of attorney is that they’re given authority to make decisions on your behalf while you’re still alive. This means they can act quickly and without worrying about consulting you first.
3. Property Decisions
With a durable power of attorney, you can also give someone authority over your property. For example, if you have a house that you want someone else to sell for you when you pass away, a durable power of attorney will allow them the special power to do so. This helps ensure your wishes are carried out after you’re gone.
What does a person NOT have control over under durable powers of attorney?
While a durable power of attorney gives a person control over your finances, it doesn’t provide them with control over your healthcare decisions. When it comes to your medical matters, they have limited powers.
In order for someone to make health care decisions about your medical care, they will need something called a health care proxy. This document allows you to designate someone as your healthcare power and gives them authority over your medical decisions in case you’re unable to make them yourself.
A health care proxy can be combined with a durable medical power of attorney, or medical POA, if you want someone else making financial decisions for you while also giving them authority to make medical decisions over your medical care.
Additionally, power of attorney doesn’t give one control over the other’s marital status. If you’re married and want your spouse to be able to make financial decisions for you if you’re unable to do so yourself, a durable power of attorney is not enough. Instead, you’ll need a living trust that names your spouse as trustee. The trustee will have full control over your assets and can use them for any purpose he or she sees fit. This includes using them for your care in case you’re unable to make decisions about your own healthcare. Living trusts also allow you to name an alternate trustee who will take over if your first choice becomes unable or unwilling to serve.
Why must you consider a durable power of attorney?
Well, you may need a durable power of attorney for many reasons. For example, if you become incapacitated and unable to make decisions for yourself, someone else will need to step in and handle your affairs. A durable power of attorney allows someone else (your agent) to act on your behalf. This can be especially important if you have only one child, multiple children, or elderly parents who rely on your financial support.
A durable power of attorney is a legal document that allows someone you trust to make financial and legal decisions for you if you’re ever unable to do so. You must have one in place before an emergency happens.
If you don’t have one, get one today! We can help you obtain the necessary legal documents and provide a notary to assist you here.
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