Most people are familiar with the idea of a “Power of Attorney” in the event they get incapacitated or are deemed mentally unfit. You may have designated that Power of Attorney go to a spouse or other family member in the event that you’re unconscious or comatose. Also, you may designate a temporary power of attorney over your children, in the event of a medical procedure, incapacitation or if you move, and leave your child in the care of another.
But a POA is more than just that.
If you need to do any official business in another state, power of attorney allows you to legally designate an agent to handle your affairs. Power of attorney is not just for doctors, lawyers, and other medical affairs; it’s also a common practice among people who travel often or those planning to retire abroad.
POA is a great tool. But it can also be a dangerous one. Before signing any POA contracts, you should consult with an attorney.
What is Power of Attorney?
There are four major types of powers of attorney, which include: conventional, durable, minor child, and medical. Most people are familiar with the medical version of POA, but don’t realize that there are other types.
- Conventional Power of Attorney: This power of attorney form is a legal document that allows an individual to appoint someone else, called the agent or attorney-in-fact, to perform certain acts on their behalf. These acts can range from handling routine tasks such as signing a check for payment, all the way to performing more complex duties such as managing a business, selling real estate, or managing a rental property.
- Durable Power of Attorney: This power of attorney type is resilient throughout your life unless it is otherwise revoked.
- Medical Power of Attorney: This is a Durable power that’s designed to be used for healthcare only, rather than also financial and business decisions. This is the type of POA people are most familiar with.
- Power of Attorney over a Minor Child: This is a power of attorney that many parents use in lieu of a guardianship or custody order to appoint a third party to care for a minor child under the age of 18 years old if the parent is deployed in the military, incapacitated, or moves to a new area while the child stays with another adult in a different city.
Before you pursue a POA, you should consider what type of POA you need. They differ strongly in uses and intent.
What Does Power of Attorney Grant You?
Power of attorney is not always necessary, but it can be useful in various situations. For example, if you are planning to travel to another state and would like someone to take care of business for you while you are away, power of attorney can allow a friend or family member to handle your affairs.
Similarly, power of attorney may be useful in the event that you are hospitalized and cannot speak for yourself. You can give a person power of attorney over your affairs in case you need someone to take care of business while you are incapacitated. Power of attorney is commonly used among citizens who plan to retire abroad or who frequently travel to another state.
A Power of Attorney does not give an individual complete control indefinitely. There are some limitations.
- Power of Attorney is not transferrable. For instance, if you have your spouse as a POA, your spouse cannot decide to transfer POA to your parents.
- POA ends at the moment of the individual’s death. At that point, the estate will be controlled by the executor.
- The POA is required to act within the individual’s best interests at all times.
- A POA can only be nominated if the individual is of sound mind; they cannot nominate a POA, for instance, after they are seen to be mentally incapacitated.
- A POA cannot use the individual’s assets or money as their own.
So, there are some very important caveats to a POA arrangement. Essentially, a POA must act responsibly on behalf of the individual.
What is Needed to Get a Power of Attorney?
A limited Power of Attorney form can be filled out online. You can sign it and have it notarized. Consider that you might want to nominate a backup POA in the event that your first POA is unavailable—especially if you are choosing a POA for medical reasons.
Primarily, you need to make sure that you have the mental capacity to make decisions for yourself. If this is in question, you will need to consult with a medical professional and get their affidavit that you are in control of yourself and mentally fit.
If you feel that the POA may be contested in the future, you may want to have additional witnesses to the fact that you signed the POA of your own free will. It is possible for individuals to appeal a POA if they believe that you were under duress or not mentally sound.
Contact Trapp Law LLC for Help
While a POA can be acquired online, it’s usually best to consult with a professional. A POA is a very powerful document. A professional who manages POA documents in Indiana can help you ensure that both you and your agent are protected.