A power of attorney is a legal status that grants someone the authority to act on your behalf. It is a document that allows you to assign a trusted party to handle your affairs, either for general, special, or limited purposes. This can be done immediately or in the event of incapacitation. The person you assign is known as the agent or proxy in fact.
Creating a power of attorney agreement can be complicated depending on the state in which you live. Prices vary depending on where you get the document from and who helps you complete it. You can revoke your power of attorney whenever you want, as long as you are mentally competent and comply with your state's revocation laws. In some cases, a limited power of attorney will give an agent the authority to make a single decision, such as signing a contract on behalf of the principal.
You can also include a modification to your power of attorney stating that it only comes into effect after a certain date or if a certain event (such as getting sick) occurred. You must specify in the power of attorney document which powers you are granting to your agent and when those powers will come into effect. Generally, your agent should not need to present the power of attorney when signing checks for you. A basic power of attorney is a fairly simple document that does not require legal assistance.
If no land is to be dealt with, it is not legally necessary to sign a power of attorney in front of a notary or have it registered, but notarization may be prudent. Generally, a power of attorney that is valid when you sign it will remain valid even if you change your state of residence. Donations are an important tool for many estate plans, and your lawyer can actually make donations on your behalf, subject to the guidelines you set out in your power of attorney. Also, keep in mind that even when a general POA does not contain such limiting language, it usually only works as long as the person transmitting the power, called “the principal”, has full capacity.
Once you have determined who your agent will be appointed, as well as what duties they will be responsible for, it's time to create the power of attorney document. Guardianship involves filing a petition, interviews with a court evaluator, and a hearing before a judge. The judge may appoint someone other than the person you chose to act on your behalf as guardian. This process can be time-consuming and expensive compared to creating a power of attorney agreement. Giving someone your power of attorney is an important decision and should not be taken lightly. It is important to understand all aspects of this legal document before signing it and granting someone else authority over your affairs.
