Special Power of Attorney
A special power of attorney lets a person engage in specific transactions on behalf of another person. The POA form provides directives regarding the transaction, as well as the date privileges expire.
Common reasons for executing a special power of attorney include authorizing an agent to conduct banking transactions, control financial investments, make business decisions, and buy, sell or trade personal or business assets.
Real estate investors often use this kind of power of attorney to let realtors buy or sell investment properties. Another use is to authorize property management groups to collect rent, conduct background and credit checks, file eviction claims against tenants, or engage in repairs for rental properties.
Business owners use special power of attorney to authorize a person to manage business affairs. This could involve hiring a tax accountant to file business tax returns, or hiring an agent to oversee business operations while the owner is out of town.
Individuals need to execute special power of attorney forms when authorizing a person to sell a vehicle, access their safe deposit box, manage personal finances or investment portfolios, or engage in real estate transactions.
Individuals and business owners that owe back taxes to the IRS and retain services of an organization to negotiate on their behalf will need to execute a special power of attorney. Agents can be authorized to setup payment plans; enter into negotiations to reduce delinquent taxes, late fees, penalties, and interest; file tax returns; or acquire a 4506 tax form.
Special power of attorney is frequently used as part of estate planning. This form is necessary to grant privileges to a person to engage in specific types of estate settlement methods. When using POA forms with estate planning it is best to consult with a probate lawyer.
Probate is the method used to settle decedent estates. Laws surrounding probate are different in each state. Many states allow estate agents to settle the estate based on authorization granted in the last will and testament, while other states require POA forms.
There are a few ways to draft power of attorney forms. Although it isn't necessary to hire an attorney, it's usually a good idea to obtain legal counsel. Lawyers charge a nominal fee to execute POA documents, but it's worth the cost to make certain forms are legally binding and will be upheld in court if problems arise.
People that choose to execute power of attorney forms on their own can purchase preformatted forms that only require them to fill in the blanks and have the form witnessed and notarized.
The legalese contained within power of attorney templates should include a Principal and Attorney-in-Fact. Principal refers to the person establishing the POA, while attorney-in-fact is the person charged with the task. This person is also referred to as an Agent and can be anyone aged 18 and over.
There are other kinds of power of attorney forms that might be better suited for the task. Some of the more common include durable power of attorney, general power of attorney, and medical power of attorney.
We provide information about each kind of power of attorney form and its uses in our estate planning article library. While we don't offer legal advice, we do provide helpful resources to help visitors better understand which situations warrant the use of POA forms.
Published on October 15, 2011 at 01:11 PM