Many of us have heard of powers of attorney but don’t really know what they are. Yet, it is in every person’s best interest to have at least one POA, so decisions are made appropriately on our behalf.
We all need a durable power of attorney in effect, even a healthy eighteen year old teen. Nobody likes to think about these things, but what if your loved one becomes incapacitated and can no long make decisions? In these cases, there are often disagreements in families over who should make decisions for that person. It can get quite messy, and very quickly. Who should have power of attorney to make decisions regarding what actions should be taken? And even worse could be if someone is incapacitated without a financial or healthcare power of attorney. Then it becomes a legal issue, and the courts may appoint a conservator to make those decisions. Now, it’s a long and expensive legal process with total loss of control for the family.
What Is a POA?
A document that gives an agent the right to act on behalf of someone else is called a power of attorney (POA). Five types exist to grant different levels of authority. A power of attorney exists by state. For example, if your brother has POA for your father in Illinois, and he moves to Colorado, the POA is invalid. You need to know what the laws are in your state. Some states require annual re-certification. Also, if you have POA for your Uncle Bill and he passes away, you no longer have any legal right to handle his financial or other affairs, unless granted in a will. Another thing to know is that Social Security is a federal, not a state program. Social Security does not recognize POAs. You must become a representative payee to handle Social Security on behalf of someone else.
The five types of POA
A durable power of attorney (DPOA) means that the agent will continue to have authority to make decisions even if you become incapacitated. (Like going into a coma or having dementia.) Unless documented otherwise, a POA becomes effective immediately after it is signed (and notarized). If it is durable, the agent will continue to have authority to make decisions even if you become incapacitated, such as by having dementia or going into a coma. If it is a non-durable POA, it simply means that the agent loses authority if you become incapacitated.
All POAs end with the person’s death. The person can also rescind a POA with a revocation form, as long as he or she is competent. Most of the POAs listed in this article can be made durable.
A Medical Power of Attorney Or Advance Directive allows an agent to make medical decisions for you if you cannot make them yourself. These include a broad range of medical treatments, surgical procedures, choice of health care facilities, organ donation and a broad range of medical treatment. Your agent will also make certain that health providers carry out wishes you have specified in your do not resuscitate (DNR) form or living will.
A General POA grants broad powers. This agent can make decisions for you regarding legal matters,real estate, business and financial matters. Your agent will be able to manage your banking, buy or sell property, pay bills, and enter into contracts. It is so extensive in nature, that it is usually used for a short period, for example, if you cannot be reached due to extensive travel.
A Limited, or Special, Power of Attorney gives an agent the power to act on your behalf but unlike a general POA, it’s limited to specific purposes. As an example, you might decide to grant someone the power to cash checks for you, but not access or otherwise manage your finances. These POAs expire at a specified time on the document or once a specific task is done.
A Conditional (or Springing), Power of Attorney only goes into effect in the event of a medical condition (usually incapacitation) or other trigger specified in the POA. For example, a soldier could create a springing power of attorney that is only in effect when he or she is deployed overseas. It can end when the person becomes incapacitated or at a specified date. As with every type of POA, it will also end upon death.
Be very specific and extremely careful when drawing up a POA. Information must be detailed about the agent’s activities and duties. If specific language isn’t there, it can cause some big headaches. If something is inaccurately listed as a trust, the trustee or successor must be the one to make financial changes. These sorts of issues can get sticky and require trips in front of a judge when the person is incapacitated.
If you know someone who is preparing to navigate these difficult issues, call 239-218-7739 to reach your local Oasis Senior Advisor. Oasis is a trusted resource for seniors and their families and can connect you to appropriate professionals for drawing up a POA, as well as other aging resources. One call to Sandy Moffett or Cindy Walker at Oasis Senior Advisors Lower SW Florida offers many solutions.
Oasis Senior Advisers
(239) 218-7739
www.OasisSeniorAdvisors.com/Lower-SW-Florida
3739 Milano Lakes Circle #408
Naples, FL 34114