A power of attorney is a document that gives the authority for one person to delegate responsibilities or authority to another individual with regard to financial transactions. A power of attorney appoints an agent to act on behalf of the creator to help the creator with a variety of legal and financial transactions. Powers of attorney can be broad in scope or narrow in scope depending on the circumstances involved.
There are a variety of different types of powers of attorney. In estate planning, a durable power of attorney is used. A durable power of attorney is different than the standard type of power of attorney. In the normal power of attorney, when the creator becomes incompetent or incapacitated the power of attorney loses effect. However, with a durable power of attorney, even in the event the creator is incapacitated, the power of attorney remains in full effect.
Who Can Create a Power of Attorney?
A durable power of attorney can only be created by someone who is competent at the day he or she executes the power of attorney. This means the person creating the power of attorney must understand the effects of the document and what he or she is doing. The agent appointed must be a minimum of 18 years of age in the State of New York.
Actions to be Taken Under a Durable Power of Attorney
Some of the actions that an agent under a durable power of attorney can perform are (1) medicaid planning, (2) paying of credit card bills, mortgage bills, fuel oil bills, and bills of any type and nature, (3) selling a home, (4) paying taxes to the state and federal government, and, (5) conducting a variety of business transactions, including making decisions on investments.
Drafting a Durable Power of Attorney
There are many unexpected issues and events that can occur during the course of a person’s lifetime. One of the purposes of the durable power of attorney is to see to it that in the event the principal is unable to take care of his or her financial needs, there is someone available to help him or her.
Elliot S. Schlissel is a member of the National Academy of Elder Law Attorneys. He assists his clients in elder care planning, medicaid planning, and drafting of wills and trusts.
