All About Power of Attorney (POA)

A power of attorney (POA) is a legal document giving one person, called the agent or attorney-in-fact, the power to act for another person, called the principal. POAs often are considered when planning for long-term care. You could be appointed as power of attorney whether or not you are an attorney — you could be a trusted family member, a friend or an acquaintance.

A general power of attorney acts on behalf of the principal as allowed by the state and as spelled out in the power of attorney document. You may be authorized to handle bank accounts; sign checks; sell property and assets, such as stocks; or file taxes.

With a power of attorney, an agent can have broad legal authority or limited authority to make legal decisions about the principal’s property or finances. For example, the limited POA might state the agent is allowed to only manage the principal’s retirement accounts. And it might be limited to a specific period of time, such as two years while the principal is out of the country.

Most power of attorney documents assume that the principal and the agent are both healthy enough to make their own decisions. Therefore, if the principal became incapacitated, the POA agreement would automatically end. If you want the POA to remain in effect after the principal’s health deteriorates, you’d need to sign a durable power of attorney.

In a durable power of attorney (“DPOA”), the agent remains in control of legal, property or financial matters that are spelled out in the agreement even after the principal becomes mentally incapacitated.  Typically, a DPOA allows an agent to manage the principal’s business and financial affairs, including signing checks, filing tax returns, depositing Social Security checks, and managing investment accounts.

A springing power of attorney defines the kinds of events or levels of incapacitation that should occur before the DPOA springs into effect. The springing power of attorney can remain dormant until a negative health occurrence activates it, making it a DPOA.

A power of attorney can end when the principal dies or revokes it or a court invalidates it. It can also become invalid when the principal divorces a spouse who is the agent, or the agent can no longer carry out the responsibilities. The power of attorney is frequently used if the principal becomes ill or disabled or if the principal can’t be present to sign legal documents for financial transactions.

While some regions of the country accept oral POAs, verbal instructions aren’t a great substitute for spelling out directions on paper. Written clarity helps avoid arguments and confusion.

You can start the process of establishing a power of attorney by locating an attorney who specializes in estate planning. There’s no standard POA form for all 50 states, but all states accept some version of the durable power of attorney.

You can count on Ericson, Scalise & Mangan, PC to provide you with sound guidance and experience in these uncertain times. For assistance with your legal needs, please contact us today at (860) 229-0369, or email us at