What Powers Can I Authorize Under a Durable Power of Attorney?

A durable and general power of attorney is an important document that should be at the cornerstone of your estate planning. A power of attorney is most effective in the event of incapacity, such as an illness or event that renders you unable to make decisions or take certain actions on your own. You can decide what works best for your situation and then discussing setting your POA up that way with your lawyer.

A durable general power of attorney authorizes a person to act in a wide range of business and legal matters, which will stay in effect even if you are incapacitated. You can decide that your general POA becomes effective only if you are incapacitated or it becomes effective immediately upon the signing of the document.

The person that you appoint as your attorney in fact or agent can handle many types of transactions on your behalf, including filing tax returns, selling and buying property, managing bank accounts and applying for government benefits. Without a general durable power of attorney in your estate planning document set, your family might need to go to court to request that you be declared incompetent so that a person can take care of your finances for you.

It’s important to recognize that a general durable power of attorney is not the same thing as a durable healthcare power of attorney. You’ll need to sit down with an estate planning lawyer to discuss some of the distinctions between various types of power of attorney documents and which of these are most appropriate for your individual situation.

Need help with your POA assignment in New Hampshire or Maine? Discuss your options by contacting our firm today.

 

 

What Does a Convenience Account Have to Do with a Power of Attorney?

If you are concerned about being able to keep up with your banking and your bill paying, using a durable power of attorney is an excellent way to appoint another person to make these decisions and take these actions on your behalf. In the process of setting up your planning, you might run across the term convenience account.

If you are older and concerned about keeping up with your financial affairs, it is natural to think about whether or not there is a family member or other person who could help you manage deposits, writing checks or getting cash out of the bank for you. This can backfire very badly if you do not accomplish the process of setting up a power of attorney in the right way.

Adding someone as a co-owner of your bank account, for example, empowers them to make all decisions as if it was their own bank account. This is different than setting up a power of attorney and can lead to problems like sibling conflict, creditor access, and misuse. The best way to give another person authority over your financial matters is to sign a document known as a durable power of attorney for finances.

Your attorney in fact would still be eligible to spend your money with regard to your bank account but there are two primary restrictions that add a layer of support for you. These are that the funds must be used only for your benefit and at the time that you pass away the money becomes part of your estate, meaning that it does not go to the person that you named as the attorney in fact.

Schedule a consultation with a trusted estate planning lawyer to discuss how a power of attorney document can be used for your best interests.  Our New Hampshire law office is here to support you with the creation of your power of attorney document so that you feel confident about your decisions.

 

 

Should My Financial Power of Attorney Agent Get Extra Authority?

Using a simple power of attorney form makes it seem as though it will be a seamless process to transfer financial authority to this person. However, you might not realize in filling out a simple online form or downloadable PDF that there are significant powers a DIY template like this does not include.

It’s important to educate yourself about these possibilities so that you can determine whether there are circumstances in which you need to give your agent extra authority. Basic power of attorney documents usually do not include the authority to:

  • Delegate the agent’s existing powers to another individual.
  • Update designations for beneficiaries on retirement or life insurance accounts.
  • Amend or create trusts on behalf of the principal in the power of attorney.
  • Create gifts from a property.

One of the reasons that simple forms don’t include these powers is because they can be very dangerous if given to the wrong individual. This could ruin your estate plan and eliminate this property if you don’t have any trusted POA agent. However, if you do trust your POA agent and want this person to have as many choices as possible for taking care of you, these powers can be essential. You’ll want to discuss the options with your estate planning attorney to determine whether or not you wish to allow for additional care and options.

Need more information about what this looks like in New Hampshire or Maine? Use us as a resource- schedule a call with our NH estate office today.

Preventing Challenges or Conflicts with Your Power of Attorney Document

Creating a financial power of attorney is one of the first and most important steps that you can take to protect yourself in the event that you become unable to make decisions or take actions with your finances.

However, you’ll want to ensure that your financial power of attorney is properly drafted and accepted. If you think that someone might end up going to court to challenge your durable power of attorney for finances or arguing that you were in fact coerced into signing it, there are several proactive steps you can take in drafting and signing the document to minimize these problems. First of all, if you previously created a financial power of attorney document by yourself, you might want a lawyer to review the document.

An experienced and knowledgeable estate planning lawyer can help you answer questions about the POA as well as any other estate planning documents you might have created. You might also be anticipating challenges to a trust or a will. A knowledgeable estate planning attorney can answer questions for all of these issues too.

A couple of key steps can minimize the opportunities for someone to challenge the validity of your financial power of attorney. While you may certainly hope that no one will end up arguing about the legality of this document, being proactive can help reduce expenses and delays with regard to your agent under the power of attorney taking the action you desire. Some actions you can take to minimize the risk of challenges to your financial power of attorney include:

  • Get a doctor’s statement saying that you appeared to be of sound mind at the time you signed the financial power of attorney.
  • Sign your document in front of witnesses and a Notary Public.
  • Make a videotape of the signing ceremony.

While we certainly hope you never need to fight back against a challenge to your financial power of attorney, it is a smart idea to take these proactive steps to avoid a challenge. Schedule a consultation today with an estate planning attorney in New Hampshire.