How to Create a Power of Attorney

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 What is a Power of Attorney?

Power of attorney refers to the legal authority that you give to an individual to handle your legal and medical affairs. This is typically done in case you become legally, mentally, or medically incapacitated and cannot tend to these or make these decisions yourself.

The designated person does not have to be a lawyer or an attorney. Often, they are simply a close friend or family member who knows the person’s preferences. In many cases, they can even be an organization. This person whom you designate is called an attorney-in-fact. The person transferring the authority is called the “principal”. 

Are There Different Types of Power of Attorney?

There are different kinds of power of attorney privileges and designations: general, special, durable, and healthcare are the most common kinds. A general power of attorney gives the designated person the broadest authority over your interests and decisions. Someone who possesses a general power of attorney generally has power to handle: 

  • Business issues; 
  • Financial issues; 
  • Insurance matters; 
  • Legal claims, gifts and donations; and 
  • Hiring related to executing these interests.

Special power of attorney privileges are typically more specific. For instance, you can designate a special power of attorney to handle matters such as real estate transactions. They can also address debts owed to you or debts or you need to pay, or manage specific business interests on your behalf. 

A healthcare power of attorney has decision-making capabilities that are specific to medical issues. These include decisions such as:

  • Whether the principal should undergo a certain surgery, medical procedure, or specific form of treatment;
  • Whether the person should go on or remain on life support; and
  • Various other medical determinations.

A durable power of attorney is specifically intended for the mentally incapacitated, as it lasts until the person’s death regardless of what happens to the person. For instance, individuals suffering from an illness that they know will later affect their mental functioning will want a durable power of attorney to allow someone to act on their behalf.

How Can I Create a Power of Attorney?

When creating a power of attorney, you will first have to select what kind of power of attorney best suits your needs. The type of power of attorney and what kinds of rights you intend to sign over depend upon your personal needs and what you think might possibly happen to you in the future. 

For instance, you need to consider if you are likely to encounter serious health problems soon based on your current medical condition You should also consider whether you are going to be unable to handle your affairs for another reason, such as being out of the country for an extended period of time.

Once you have selected your type of power of attorney, you will want to consider if you want only one agent or multiple agents acting on your own behalf. You can appoint several agents who have different responsibilities, depending on your needs. 

However, sometimes, too many people acting as agents can make legal issues more complicated. Other times, multiple agents can keep each other in check and provide balance. Regardless of how many people or who you select to be your agent, it is very important that you trust this person or these people completely before signing over rights to them.

If you need help on deciding which power of attorney to select, and how many agents to designate, then you may wish to consult with a lawyer for advice and guidance.

Do I Need a Power of Attorney Form?

Yes. After you have chosen the person or people to whom you want to grant power of attorney and discussed the specifics of the agreement with them, you will need to sign a power of attorney form. 

There are often existing template forms that can be used as a guide, but it is always best to get legal advice from a lawyer. This will help to ensure that the document that you intend to use to convey the power of attorney to another meets all of your requirements and is legally binding.

Various legal issues and disputes can arise from poorly-written power of attorney documents. For instance, vague language can result in misunderstandings regarding the exact scope of an agent’s decision-making abilities. Also, as mentioned, conflicts can arise between multiple agents if their exact responsibilities are not spelled out very clearly.

In the end, forms are never one-size-fits-all. You can have circumstances that would make the form ineffective and useless. You may be trying to save money in the beginning by not hiring a lawyer and using a form, you can run the risk of not being able to rely on your power of attorney when it really counts. 

Do I Need a Lawyer for Help Creating a Power of Attorney?

Power of attorney is a powerful mechanism that grants the right to your designated agent to make the most sensitive decisions of your life for you. For this reason, it is important to get a estates lawyer to prepare and review the forms for accuracy and legal authority. 

Your lawyer can provide you with legal advice on these arrangements, as state laws will vary on the exact details. If any disputes arise in connection with the powers of attorney, your lawyer can provide representation in court as well.

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