A Power of Attorney is a document in which you give a loved one or a trusted friend the legal authority to take over the management of your finances and legal matters on your behalf. The individual who is appointed to act on your behalf, is referred to as your “attorney-in-fact.”
Your attorney-in-fact is granted the legal authority to act on your behalf, but only to the extent allowed by the provisions contained in the Power of Attorney.
A “General Durable Power of Attorney” gives your attorney-in-fact the authority to manage all of your property (bank accounts, investments, retirement accounts, motor vehicles, real estate and a business owned by you), sell any of these assets, purchase assets on your behalf, file tax your tax returns, and to handle any legal matter that concerns you.
If you become physically or mentally incapacitated as a result of illness, an accident, or advanced age, and you have a General Durable Power of Attorney, your attorney-in-fact can manage your finances, pay your bills, and sign any necessary legal documents or tax returns without being appointed as your Guardian in a public Probate Court proceeding.
You can decide to pay or not pay your attorney-in-fact. Often times for senior clients it is wise to allow the attorney-in-fact to be paid. The reason for this is that money that would otherwise just be taken for the nursing home care, may be used to pay a loved one or friend for acting as your attorney-in-fact. This allows for at least some of the money to stay in the family.
What can an attorney-in-fact do!
• Process a Medicaid application if you need nursing home care;
• Hire a lawyer for you if you need one;
• Sign a deed to sell/buy or transfer property if necessary;
• Access you bank/fiduciary accounts that are held in your name alone;
• Sell or buy a vehicle in your name.
• Pretty much anything you can do, an attorney-in-fact can do.
What happens if you don’t have a Power of Attorney and something happens to you and you are unable to manage your own affairs?
• Someone (it may not be someone you want) will have to hire a lawyer, go to court and seek the court’s permission to manage your affairs.
• Even if you are married, a spouse does NOT have the legal right to sign your name on a legal document.
• This process to seek the court’s permission is both an expensive and public process which can easily be avoided by simply having a well drafted Power of Attorney.
So remember to “Have the Will to Plan Ahead!”
Merrill J. Atkins, Attorney at Law