Estate Planning And Power Of Attorney
Power of attorney (POA) is a written, authorized contract in which an individual, the principal, grants another individual, the agent, the authority to act on the principals behalf in regard to private, business, or financial decisions. Durable, statutory, and medical are the valuable assortments of power of attorney that are available at present.
Establishing the extent of, and limitations to, the agents power is essential to a successful relationship between the two parties. An agent can be anyone the principal trusts (who is typically 18 years old or older) to carry on the principals important matters, which may include financial, personal tax, and real estate matters. The letter of attorney may identify alternative agents if the named agent dies, becomes legally disabled, resigns, or refuses to act on behalf of the principal. A letter of attorney sets the standard for the amount of authority that the agent will have. It should be very specific about what powers are being granted and what limitations are placed on these powers.
With a durable letter of attorney, the document typically states that the transfer of power is effective immediately or when the principal is unable to coherently make decisions on his/her own due to some disability or incapacity. If the durable letter of attorney is to become effective when the principal becomes disabled or incapacitated, the definition of disability and incapacity should be included in the power of attorney, along with a method of showing the existence of a disability or incapacity. This helps the agent and third parties know when the powers pass to the agent. This is important because some third parties may be cautious about recognizing the agents power to act on behalf of the principal. A statutory power of attorney, simply tracks the language from the States letter of attorney statute. To make a legally binding, it must comply with all state laws, and should be signed, dated and notarized by the principal.
Medical power of attorney assigns an agent to make health care decisions for the principal when a physician certifies in writing that the principal is no longer able to make these important decisions. For example, a person is unable to make health care decisions while in a severe coma. Despite the significant grant of power, an agent is obligated to follow the principals instructions when making decisions on his/her behalf and the principal may revoke the authority granted to the Agent. Two witnesses must be present for the signing of the written medical power of attorney, and there are limitations on who may serve as witnesses.
The letter of attorney is a valuable tool that can provide the principal with the peace-of-mind that his/her affairs will be taken care of. If you would like to know more about durable, statutory and medical power of attorney, consult with a trusted legal professional.
Establishing the extent of, and limitations to, the agents power is essential to a successful relationship between the two parties. An agent can be anyone the principal trusts (who is typically 18 years old or older) to carry on the principals important matters, which may include financial, personal tax, and real estate matters. The letter of attorney may identify alternative agents if the named agent dies, becomes legally disabled, resigns, or refuses to act on behalf of the principal. A letter of attorney sets the standard for the amount of authority that the agent will have. It should be very specific about what powers are being granted and what limitations are placed on these powers.
With a durable letter of attorney, the document typically states that the transfer of power is effective immediately or when the principal is unable to coherently make decisions on his/her own due to some disability or incapacity. If the durable letter of attorney is to become effective when the principal becomes disabled or incapacitated, the definition of disability and incapacity should be included in the power of attorney, along with a method of showing the existence of a disability or incapacity. This helps the agent and third parties know when the powers pass to the agent. This is important because some third parties may be cautious about recognizing the agents power to act on behalf of the principal. A statutory power of attorney, simply tracks the language from the States letter of attorney statute. To make a legally binding, it must comply with all state laws, and should be signed, dated and notarized by the principal.
Medical power of attorney assigns an agent to make health care decisions for the principal when a physician certifies in writing that the principal is no longer able to make these important decisions. For example, a person is unable to make health care decisions while in a severe coma. Despite the significant grant of power, an agent is obligated to follow the principals instructions when making decisions on his/her behalf and the principal may revoke the authority granted to the Agent. Two witnesses must be present for the signing of the written medical power of attorney, and there are limitations on who may serve as witnesses.
The letter of attorney is a valuable tool that can provide the principal with the peace-of-mind that his/her affairs will be taken care of. If you would like to know more about durable, statutory and medical power of attorney, consult with a trusted legal professional.
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