How to get power of attorney (POA) document is usually considered important for an aging person. However, this isn’t true as the scope of a POA can play a critical role in various scenarios. It is best to safeguard the interests of its principal irrespective of their age.
If you are planning to appoint someone as your POA then this blog is for you. Keep reading to know every crucial detail about POA.
What is a power of attorney (POA) document?
In simple words, a power of attorney (POA) document is a legal document of authority. This authority is from one person, known as the ‘principal’, to another person, called the ‘agent’, granting him the power to take certain sets of actions or decisions on the principal’s behalf.
Generally, such decisions are concerned with the legal, business, wealth, and medical subjects of the principal.
When is appointing a power of attorney (POA) deemed appropriate?
The most common instances of appointing a POA happen when the principal is aging. Due to this reason, such people might become more vulnerable to losing their ability or confidence to make sound-minded decisions.
Appointing a power of attorney in such cases can greatly help such people abstain from making unfit decisions, consequences of which may impact their well-being.
Besides this, a POA document becomes quite valuable and sometimes a way to avail an opportunity, in few other cases. In such scenarios, neither the principal is aging nor becoming incapable of evaluating the probable results of their decisions. In fact, the principal is perfectly fit both mentally and physically.
For example, a principal may authorize a real estate agent to make a purchase or sale of some property without himself being physically present at the event.
Similarly, a parent may assign a guardian under a POA to look after the matters of their minor age children, in case of the principal’s (parent) absence.
Types of power of attorney
A power of attorney document will vary according to the purpose and circumstances of each case. Therefore, based on this diversification of matters that it can be applied to, there are five types of power of attorney.
- General POA
- Durable POA
- Non-Durable POA
- Special or Limited POA
- Springing Power of Attorney
These types explain when a POA becomes enforceable or revocable in the event of the principal becoming or not becoming incapacitated.
General power of attorney
As the name suggests, a general power of attorney can include the authority to make decisions regarding multiple and many interests of the principal. For example, looking after day-to-day affairs, children’s education, etc.
Such power of attorney becomes invalid when the principal either cancels the POA itself, becomes incapacitated, or passes away.
Durable power of attorney
A durable power of attorney also gives the authority to look after the vast affairs of the principal. Such POA is not governed by a fixed time period and would not be revoked even if the principal dies.
A durable power of attorney is exercisable when the principal becomes incapacitated or is unable to look after his affairs.
Non-Durable power of attorney
A non-durable POA is a limited-time authority granted to an agent to fulfill any particular task or carry out a transaction.
Such power of attorney will automatically expire once its intended objective is accomplished.
Special or limited power of attorney
The example of appointing a real estate agent in the beginning paragraphs of this article is a case of special or limited power of attorney.
Such POA is usually for carrying out one-time business, banking, or financial nature transactions on behalf of the principal because the principal is unable to do so due to their other commitments.
These power of attorney documents also clearly mention the exact scope of POA regarding what can and cannot an agent do on the principal’s behalf. In such cases, an agent is exactly transacting as if the principal was present on the spot to do the same.
Under the special or limited power of attorney, an agent cannot in any case, unless approved by the principal, alter the existing rights granted to him.
Springing power of attorney
A springing POA is a document that is enforceable when a certain condition is met. Examples of such conditions can be the principal becoming incapacitated or the occurring of any other contingent event.
Power of attorney records
Remember that a POA is only valid when it is in written form. This means that any verbal communication between two persons taking the role of a principal and an agent will not constitute a valid or enforceable POA.
A written POA document is enforceable and acceptable in all the states of the US. Although the rules and requirements of POA may vary from state to state.
Depending on your state or the institution you are dealing with such as your bank, you might be provided with a standard draft format or form of how the POA should be like.
Once you have formally drafted or filled in the details on the prescribed POA form, get it witnessed and notarized.
After this, a copy of the POA should be made available to every concerning person including the agent while the original POA stays with the principal.
And unless a POA is related to real estate, it does not need to be submitted in court or other relevant government offices to become effective.
To cancel a power of attorney, you should serve a written notice to the agent and every concerned person as well as the court and government office if the case may be.
Aside from the responsibilities entrusted through the POA, an agent also has the following responsibilities –
- Carefully read the POA document to fully understand the responsibilities that the principal has assigned you. In case of any ambiguities, ask the principal or his lawyer or consult your lawyer to better understand what may be bothering you.
- If the POA involves the right to access legal or other important documents, ask the principal to either provide them in advance as original or copies or make arrangements for their prompt availability if and when needed.
- Take possible measures to make sure that the duties you have been assigned are being honored rightfully and in the best interest of the principal.
How to get power of attorney?
As a power of attorney is responsible for many of your legal tasks, you need to decide wisely. You must look for someone trustworthy and reliable enough to fulfill all the duties. The agent you hire should be capable enough to handle your affairs when you are unable to do so. Once you have hired the ideal and the most responsible POA, it is time to decide what tasks to assign them. It is entirely dependent on you to what extent of duties you wish to give to your attorney and what circumstances they will take action.
Anyone above the age of eighteen can set up an attorney depending upon the circumstances. While you are looking for an answer on how to get a power of attorney, you might come across various explanations and limitations. Moreover, the POAs might differ according to the state you live in and the responsibilities you want to assign to them. Every state has its requirements for hiring power of attorney. Therefore, you will have to choose one adequately aware of the state’s legal rules and conditions.
What are the requirements and limitations while setting up a Power of Attorney?
While setting up a power of attorney, various questions might pop up in your mind, including whether you need a lawyer to get a power of attorney. These questions are general if you are looking for a power of attorney. It is not legally mandatory to hire a lawyer while setting up a POA. But, you should consider it if you are planning on giving high responsibilities and powers to the attorney. The lawyer will provide you with necessary legal advice before you put any complicated duties on the POA.
Moreover, the attorney also helps to ensure that your appointed POA can take all the responsibilities or not. The financial and business obligations and make sure that they are aware of the issues if power invokes. The lawyer also questions the POA to learn if they are fully aware of the state’s legal rules and requirements. The POAs have to face certain limitations as well. For example, the POA can only operate when the principal has total capacity.
What are the drawbacks of not having a power of attorney?
POAs help you in various ways from protecting your finances, real estate interests and making good decisions for your health. These decisions are made when you are mentally or physically unfit to do on your own. They can also protect your manner of dying. If you don’t have a POA, your family will have to deal with costly and time-consuming trials. But the POA can be appointed by the people themselves, and no one else can do it except the court.
If a person becomes mentally unfit to set up a POA, neither the close relatives nor any of the friends can appoint the POA on their behalf. In such a case, the court appoints the guardian or conservator that helps set the POA that will take over the affairs of the unfit person. When the POA is established, no one can interfere in the matters of the person. So, setting up a POA when you are stable, it will save your family from ugly situations. Even when you die, your POA will distribute your assets justly according to your mentioned instructions.
What are the rights of the POA?
A power of attorney has the right to make important life decisions on behalf of the principal. POA is often the agent, while the person who sets them up is called the principal. The principal set up the POA through the whole legal procedure and appointed his specific duties and responsibilities. Therefore, considering this, the POA has various power of attorney rights and limitations, also can be termed as duties in this regard.
Some of the rights of a power of attorney are listed below;
- The right to make financial decisions on behalf of the principal. These include personal or business-related issues.
- To buy or sell property on behalf of the principal.
- The right to make healthcare decisions and hire appropriate doctors for the principal.
- To open bank accounts or purchase life insurance policies for the principal.
- The right to open a lawsuit or sign the necessary legal documents on behalf of the principal.
- To make appropriate living arrangements according to the health of the principal.
- The right to receive various income forms on behalf of the principal.
What are the limitations of the POA?
Although the POAs manage many of your legal affairs, there are certain limitations that you should take care of. Some of the regulations are:
- It cannot take any legal decisions after the death of the principal.
- Power of attorney cannot transfer the responsibilities to any other agent.
- It doesn’t have the right to work against the interests of the principal.
- It cannot change the will or make amendments in real estate planning.
The practicality of life is that it is highly unpredictable. And this does not only mean any unforeseen event that may cause death. So, it is always advisable to appoint the right person as your power of attorney at the right point in your life. Having a trustworthy person to take care of your interests on your behalf brings you peace of mind. So, what are you waiting for? Get your POA set up today!