Power of Attorney Form
A power of attorney form is used for all kinds of transactions that require one person to authorize another person to act as their agent. These forms are an essential component of estate planning, business operations, personal finance, and healthcare matters.
The kind of power of attorney form needed depends on what duties the agent is responsible for performing. For example, a limited power of attorney is used to provide agent privileges to do a specific task during a specific timeframe, while a durable power of attorney grants sweeping rights.
Two parties are involved with each type of POA. Principal refers to the person writing the document and Attorney-in-Fact refers to the person responsible for carrying out tasks. The attorney-in-fact doesn't have to be a lawyer. In fact, they are usually a spouse, relative, business partner, financial advisor, physician, or friend.
The most common approach for establishing power of attorney documents is to hire a lawyer. They can offer guidance regarding which type of POA is best suited for the situation. Lawyers can draft POAs and record documents through courts for a nominal fee.
There are "Do it Yourself" kits preformatted documents, and forms that can be downloaded via the Internet. It's advisable to at least have a lawyer review self-written power of attorney forms to make certain they are legally-binding. Many times, forms offered for free contain outdated information that can lead to legal problems later on.
A middle-of-the-road option is to setup power of attorney forms using LegalZoom; an online legal provider that lets visitors type in information to create all kinds of legal contracts.
People that want to setup a medical power of attorney can find forms at physician offices, nursing homes, hospitals, and the state Department of Health. Appointing an agent to make healthcare decisions is an important task. Healthcare agents are required to uphold any decisions the Principal has regarding medical procedures.
Medical power of attorney becomes effective when the document is executed. However, agents are not allowed to make medical decisions until the Principal's physician files a formal letter stating the patient is incompetent.
Medical POA forms should be setup when a person is scheduled for surgery, has terminal illness, or suffering from progressive diseases like Alzheimer's. Physicians attending the Principal's care must abide by directives in the healthcare POA or provided by the agent.
Limited power of attorney is used to let agents manage a limited number of transactions for a limited amount of time. Also known as a special power of attorney, this type of POA is most often used to grant privileges to pay bills, conduct banking transactions, buy or sell real estate, or file tax returns for the Principal. Privileges are valid only for the transaction included in the POA and expire when the task is complete or by a specific date.
General power of attorney provides wide sweeping privileges that allow agents to take care of nearly everything a person does to manager their life. This can include taking care of personal and business financial matters; managing financial and real estate investments; managing a business; entering into contracts; or acting as a representative in legal matters such as lawsuits or negotiating with the IRS
Durable power of attorney provides the highest level of privileges and allows agents to engage in tasks such as those in the General POA. The primary difference is Durable POA privileges extend until the Principal passes away.
Principals can revoke POA rights at any time by issuing a revocation power of attorney form. If it was necessary for the original POA to be recorded via court, the revocation form also has to be recorded.
Creating a power of attorney form is not hard, but it can be hard to understand all the legal jargon. We provide information about each type of POA form; its uses; and the powers granted in our personal finance library. We hope you find the information beneficial.
Tagged: Durable Power of Attorney, Estate Planning, General Power of Attorney, Limited Power of Attorney, Medical Power of Attorney, Power of Attorney, Power of Attorney Articles, Power of Attorney Form
Published on November 01, 2011 at 04:28 AM