Durable Power of Attorney

While the terms “general power of attorney” and “durable power of attorney” sound similar, there are differences that are important to recognize. A general power of attorney will automatically end if the principal loses mental capacity, usually due to an injury or illness. A durable power of attorney will remain in effect until death even if the principal is unable to make decisions on their own unless it is revoked through the court.

An individual will not be permitted to execute a durable power of attorney if they are considered incompetent. If you wait, it will have to go through court, which could be costly and time-consuming, putting your needs on hold during that time. Having a Durable Power of Attorney in place ahead of time will help you be prepared for anything.

The most important qualification that the person should have is trust. It could be a family member or a close friend. This person should be responsible, organized, and able to communicate well. You can choose to have an accountant or lawyer act as your agent if you are unable to identify a trusted individual. An attorney may also be beneficial if you have a larger estate to manage.

A durable power of attorney is often mistakenly referred to as both medical and financial POA, but these are actually separate powers. A Medical Power of Attorney is designated to only make medical decisions on your behalf, leaving the financial decisions for a separate party. Often, an individual will designate one person to be both their Durable Power of Attorney and Medical Power of Attorney, but you can choose two people; one to make medical decisions and one to handle financial and legal needs.

• Pick up and sort mail
• Pay bills, taxes, and medical expenses
• Deposit checks and other bank transactions
• Estate property management
• Collect benefits on your behalf
• Manage retirement accounts
• Operate your business
• Sign documents on your behalf

When creating your document, you will be able to choose what kind of power to give to your agent. You may want them to handle all of your financial transactions or you may want to limit their responsibility to specific obligations. You can also grant additional powers or limit specific powers not mentioned.

When creating the Durable Power of Attorney document, you can choose whether you want it to take effect immediately, or if you want it to become effective only if you become incapacitated. If you wait until you are incapacitated, this is referred to as a Springing Power of Attorney.

Many people choose this option because they are still able to manage their needs and do not want to give up that power. But, the disadvantage to this option is waiting for a physician to determine if the person is incompetent.

What if you need help on some days but not others? What if you need help with specific things but can handle other things on your own? It may be better to have your Durable Power of Attorney take effect immediately but have this person understand that you would like to handle things as you normally would.

If you still have mental capacity, you can change or cancel your Durable Power of Attorney at any time. If you become incapacitated, it must be done through court. If your family and loved ones do not feel that your agent is acting in your best interest, they may request to revoke the Durable Power of Attorney through court.

A lawyer is not required to create a Durable Power of Attorney. There are many online resources that allow you to create one on your own by answering a few simple questions. Most states require that the document is signed in the presence of a notary. Other states require the presence of one or two witnesses. However, some of these forms may not appropriately represent the details of your estate or cover the legal requirements of your state.

It is always recommended to consult with a local attorney when designating your Durable Power of Attorney to make sure the forms are filled out correctly, especially if you have a large or complicated estate. An attorney will be able to focus on your specific estate planning needs and address any questions that you may have.