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If you become catastrophically injured or terminally ill and unable to consciously make decisions, who would be able to make them for you?
While many people assume that a spouse or child automatically has authority, this assertion is not the case without having to jump through legal hoops. By the time they receive power to make decisions on your behalf, it could be far too late in some situations.
Instead of leaving yourself exposed, draft and execute a durable power of attorney to protect your rights and provide your loved ones with peace of mind. Continue reading to learn everything you need to know about durable powers of attorney.
What is a Durable Power of Attorney?
Durable powers of attorney (DPOA) allows someone to act as an attorney-in-fact agent on behalf of the principal. Powers extend to authority over financial, medical, and legal affairs decisions if the principal cannot do so. It is a document intended to make the decision-making process as easy and quickly as possible for the agent.
People generally assign durable powers of attorney to:
- Adult children
The person you choose to act as a durable power of attorney should be someone you trust implicitly. This individual may be called upon to render decisions on your behalf and in your best interest. It is also helpful to select a person with whom you routinely interact so that they have a better understanding of how you make personal decisions.
A durable power of attorney ends when specific conditions are met. You have the right to revoke these powers at any time and on your own free will. However, they will automatically end upon your death regardless of preceding events.
Difference Between Durable Power of Attorney and General Power of Attorney
The primary difference between a durable power of attorney and general power of attorney is that durable POAs remain intact until the principal either revokes authority or dies while the latter ends upon principal incapacitation. They also share different purposes as well.
Since this article focuses on durable powers of attorney, let’s take a brief but closer look at general powers of attorney.
General Power of Attorney
A general power of attorney offers support to the principal while still alive and able to consciously make independent decisions. There are usually specific healthcare issues that necessitate using a general power of attorney, such as a mental illness or catastrophic injury.
Reasons to use a general power of attorney include:
- Handle financial matters
- Operate an owned business
- Manage and discuss insurance policies
- Making doctor’s appointments
- Discuss medical records
- Issue critical decisions in their place
- Retain legal rights to specific designations
There are many tangible reasons to use a general power of attorney when a person is still alive and cognitive. However, a general POA does not address issues once the principal becomes incapacitated. Let’s look at this situation more closely and other reasons to use a durable power of attorney.
Here is an article on Power of Attorneys.
Reason to Use a Durable Power of Attorney
Reasons to use a durable power of attorney primarily center around a specific triggering event. Sometimes these events lead to family lawyers calling the document a “springing POA” when certain conditions are met—for example, your durable power of attorney “springs” into effect upon your incapacitation.
There are two types of springing POAs that you can use, including a durable power of attorney for health care and a durable power of attorney for finance.
Durable Power of Attorney for Health Care
Durable powers of attorney (DPOA), also known as a medical power of attorney , for health care allows a proxy to make medical decisions on your behalf if you become injured or terminally ill, rendering you incapacitated. It is also a limited power of attorney because the proxy cannot make legal decisions on unrelated matters, such as financial affairs.
Durable Power of Attorney for Finance
Durable powers of attorney (DPOA) for finance, also known as a financial power of attorney, allow your proxy to make financial decisions for you if you become incapacitated or unconscious. They can authorize transactions, make withdrawals, open new accounts, and speak with the bank on your behalf. Your financial DPOA must be someone you know and trust well since they have direct access to your financial accounts.
There are other types of legal powers of attorney. However, the above-referenced documents are used most commonly. Always speak with estate planning lawyers about your options if you have questions.
Important Clauses in a Durable Power of Attorney
Durable POAs must contain specific guidelines and provisions like any other contract. Missing essential clauses in a durable power of attorney can render them invalid or unenforceable. This situation will lead to additional legal issues with which your family must contend.
Important clauses in a durable power of attorney agreement include:
- Introduction of the parties
- Specific delegate powers
- Choice of law clause
- Signature block with datelines
- Notarization block
The above-referenced list is a simple outline of the critical durable power of attorney clauses that you will want to incorporate into your documents. However, other provisions are necessary, especially when creating a springing power of attorney, such as a medical POA or financial POA. You can learn more about your legal rights and options by getting legal help with your durable power of attorney.
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Get Help With Your Durable Power of Attorney
A durable power of attorney is one component of a solid estate plan. This document will grant your loved ones the authority to act on your behalf, but you could also benefit by engaging the estate planning process to take tax advantages, ensure your final wishes are met, avoid probate, and leave a lasting legacy.
Other estate planning documents that you may want to consider with your durable power of attorney includes:
Probate lawyers and estate planning lawyers in your state can help you draft and sign these documents while ensuring that you meet your end-of-life objectives. It is challenging to determine which type of estate plan you need without speaking to a legal professional.
Efficient Legal Help for Spouses
Attorneys can also assist other family members. If you have a spouse, they will most likely need one, too, if not already in place. You and your spouse can work with the same individual to ensure a cohesive strategy is in place.
Effective Legal Analysis
Your durable power of attorney and overarching estate plans should reflect your financial, medical, and legal situation. Estate planning lawyers have professional training to spot indirect issues that could affect your plans. Avoid legal mistakes and redundancies by hiring a legal team to draft your documents early on.
Ongoing Support to Update Documents
It is not unusual for someone’s situation to change over time. Your attorney can offer you ongoing maintenance services on your durable power of attorney and other estate planning documents. It is usually comforting and encouraging to know that someone can help you as necessary.
Meet some of our Durable Power of Attorney Lawyers
I focus my practice on startups and small to mid-size businesses, because they have unique needs that mid-size and large law firms aren't well-equipped to service. In addition to practicing law, I have started and run other businesses, and have an MBA in marketing from Indiana University. I combine my business experience with my legal expertise, to provide practical advice to my clients. I am licensed in Ohio and California, and I leverage the latest in technology to provide top quality legal services to a nationwide client-base. This enables me to serve my clients in a cost-effective manner that doesn't skimp on personal service.
I am a 1984 graduate of the Benjamin N Cardozo School of Law (Yeshiva University) and have been licensed in New Jersey for over 35 years. I have extensive experience in negotiating real estate, business contracts, and loan agreements. Depending on your needs I can work remotely or face-to-face. I offer prompt and courteous service and can tailor a contract and process to meet your needs.
Tim advises small businesses, entrepreneurs, and start-ups on a wide range of legal matters. He has experience with company formation and restructuring, capital and equity planning, tax planning and tax controversy, contract drafting, and employment law issues. His clients range from side gig sole proprietors to companies recognized by Inc. magazine.
For over thirty (30) years, Mr. Langley has developed a diverse general business and commercial litigation practice advising clients on day-to-day business and legal matters, as well as handling lawsuits and arbitrations across Texas and in various other states across the country. Mr. Langley has handled commercial matters including employment law, commercial collections, real estate matters, energy litigation, construction, general litigation, arbitrations, defamation actions, misappropriation of trade secrets, usury, consumer credit, commercial credit, lender liability, accounting malpractice, legal malpractice, and appellate practice in state and federal courts. (Online bio at www.curtmlangley.com).
Real Estate and Business lawyer.
Davis founded DLO in 2010 after nearly a decade of practicing in the corporate department of a larger law firm. Armed with this experience and knowledge of legal solutions used by large entities, Davis set out to bring the same level of service to smaller organizations and individuals. The mission was three-fold: provide top-notch legal work, charge fair prices for it, and never stop evolving to meet the changing needs of clients. Ten years and more than 1000 clients later, Davis is proud of the assistance DLO provides for companies large and small, and the expanding service they now offer for individuals and families.
Braden Perry is a corporate governance, regulatory and government investigations attorney with Kennyhertz Perry, LLC. Mr. Perry has the unique tripartite experience of a white-collar criminal defense and government compliance, investigations, and litigation attorney at a national law firm; a senior enforcement attorney at a federal regulatory agency; and the Chief Compliance Officer/Chief Regulatory Attorney of a global financial institution. Mr. Perry has extensive experience advising clients in federal inquiries and investigations, particularly in enforcement matters involving technological issues. He couples his technical knowledge and experience defending clients in front of federal agencies with a broad-based understanding of compliance from an institutional and regulatory perspective.