Duties of the Power of Attorney
A power of attorney gives a broad range of business and financial powers as specified in the document. Some typical powers in a very broad power of attorney might include powers to:
- Do many personal business transactions or other acts that you could otherwise do
- Sue in your name and collect money owed you from any source
- Make gifts of real or personal property
- Buy or sell property (of any type) owned in your name
- Maintain, improve, rent, or lease any of your property
- Establish or terminate any financial accounts in your name
- Sign any contract in your name
- Sign your name to any tax returns
A power of attorney can be either full or limited as outlined in the legal document. There are some things that the holder of a power of attorney cannot do on your behalf; these include:
- Fulfilling a contract that requires your personal services
- Completing a legal affidavit that requires your personal knowledge
- Making a will for you
- Voting in an election for you
A power of attorney becomes void upon the signer’s death.
Selection Criteria for the Attorney-in-Fact
Choose your agent carefully. You are giving this individual the power to perform important financial transactions outlined in the legal document. If given full power, your financial agent/attorney-in-fact can transfer assets into a trust while you are alive and do anything that you could do, if you were still able.
- Your agent—or agents—may be a relative or friend, or you may want to hire an accountant, trust officer, or banker.
- For convenience, it is helpful if your agent lives in close proximity to you.
- Choose a person who is trustworthy, has good financial management skills, and has earned your utmost confidence in his or her judgment and ability.
- Because handling the financial affairs of another can be a time-consuming job, be certain that the person you designate is willing to take on the responsibilities, if necessary.
If you become unable to make your own decisions and have not prepared this document, it is likely that your family will have to seek a guardianship or conservatorship action from the court in order to have the legal authority to manage your financial affairs. This can be inconvenient, costly, and cause delays. This is an important document; don’t delay in getting it prepared.
Next: Property Transfer >>
III. Power of Attorney: Planning for Incapacity
- a. Common Types of Powers of Attorney
- b. Duties of and Selection Criteria for the Attorney-in-Fact
IV. Property Transfer: Documents and Legal Arrangements
VII. Personal Representative: To Carry Out Your Wishes
VIII. Gifting and Tax Strategies
X. How to Hire and Work with an Attorney
Prepare Your Estate Plan belongs to a series called Legally Secure Your Financial Future. The series also includes information to help you organize important household papers and to communicate your health-care wishes.