Issues to Watch Out for with Your Power of Attorney
Powers of attorney can be valuable documents in a person’s estate plan, but without proper guidance from an experienced estate planning attorney, the document may not work as intended or needed, or fail completely because it is not valid. Powers of attorney are intended to assign power to perform certain acts to third parties on behalf of another person. The person receiving the authority acts as an agent and the extent of their decision-making power is dictated by the terms in the power of attorney document. For purposes of estate planning, powers of attorney are particularly useful when a person has concerns about not being able to make decisions due to incapacity. Financial matters will still need to be addressed, but illness, an accident, or the health issues common to growing older can all diminish a person’s ability to function. However, only one type of power of attorney is still valid once the person granting authority becomes incapacitated – a durable power of attorney. These are not as easy to effectively draft as many information sources would lead the public to believe, and if improperly executed, can leave family members in a bind when it comes to handling the incapacitated individual’s affairs.
Issues with the Technical Requirements
Typically, powers of attorney are automatically invalidated upon the incapacity of the creator. As noted, the only exception is a durable power of attorney, but in order to survive, specific requirements in the content and form of the power granting document must be satisfied. One of the issues that is most commonly missed, especially when one uses standard forms, and even with some attorneys, is the failure to initial each power listed in the document. Unless the initials are included, the power will not become effective, which can cause considerable problems when seeking to qualify the person for Medicaid related to nursing home care. Further, specific language must be included for the document to legally qualify as a durable power of attorney. These requirements highlight why working with an experienced estate attorney to draft these documents is so important.
Assessing the Powers to Include
The other big issue that routinely emerges with ineffective durable powers of attorney is the failure to include all the powers the agent will need to address the full range of matters necessary to handle the person’s situation. Leaving out key powers, particularly those related to conducting bank transactions, can hamstring the agent’s ability to pay for the individual’s medical care and other needs during the period of incapacity. If the specific language that appears in the statute is included in the document, it will make it harder for financial institutions to challenge the authority of the agent to access the money for the creator’s benefit. The types of powers that should appear in the document will vary by the circumstances of each person, which is why the advice of an estate attorney is so crucial to the creation of an effective document.
Talk to a Florida Estate Planning Attorney
Everyone needs an estate plan, and if you have questions about your current plan, or need help setting one up, talk to Clearwater estate planning attorney William Rambaum to learn what you may need. Estate plans do not have to be complicated, but there are technical requirements, and missing small things can have a huge impact when the documents are needed after your death. Avoid this outcome, and get the legal help you need by calling the office to schedule an appointment.