A power of attorney is a very interesting and possibly powerful document. The document gives a person you choose, your agent, the power to act for you. The powers given to the agent can be incredibly broad or very specific. For instance, you can narrowly tailor an agent’s power to act only for real estate transactions. You can go as broad as to give an agent power to gift away all a person’s assets for Medicaid planning. That person may even be given authority to make gifts to themselves. Your agent should be a person that you trust implicitly. A power of attorney is a very important estate planning tool and can possibly prevent the need for a guardianship.
Powers of attorney can be durable or springing. A durable power of attorney will continue through a person’s incapacity. A springing power of attorney, ‘springs’, into action when a person becomes incapacitated. The problem with a springing power of attorney is, who decides that you are incapacitated? Many springing power of attorneys require that two or more certified doctors declare you to be incapacitated. This can become an issue due to HIPAA violations and can result in costly court hearings. A durable power of attorney is recommended.
Your agent is under a fiduciary responsibility to act in your best interest. The agent should also keep records and receipts of all payments through the power of attorney and needs to keep the property separate and distinct from their own assets. Ira K. Miller & Associates has over 35 years of experience within estate planning & power of attorneys. For further questions or to request a consultation please feel free to give us a call at (718) 875-2191 or fill out an online contact form.