Essential Elements of Durable Power of Attorney
The durable power of attorney is used to authorize a person to make legal decisions on your behalf about finances and health care. The ‘lasting’ part keeps the powers in place until death; allow the agent to perform tasks such as paying bills, making deposits, filing tax returns, or obtaining medical records.
Without a Durable Power of Attorney, family members will not have a say in medical or financial decisions. To administer affairs, they have to go to court to appoint a person as a proxy and get permission to act on their behalf. This is not only inconvenient, but adds to the existing burdens of dealing with the crisis at hand. This can be avoided by setting up financial and medical POA forms.
The easiest way to execute these documents is to hire an attorney. Other options include using legal service providers like LegalZoom or buying DIY kits online or at office supply stores.
A financial POA is recommended for everyone who has any kind of personal finance issues. This document gives the designated agent permission to pay bills; make deposits in bank accounts, financial portfolios and retirement accounts; file tax returns; and engage in specific transactions documented on the POA form.
Medical power of attorney forms allow people to indicate what types of health care procedures they want or do not want to receive if a life-threatening event occurs. Some states require people to execute a living will instead of a medical POA, so it’s best to get legal advice to determine the appropriate forms.
Health care directives must include a consent form to release medical records to the proxy. Confidentiality laws prohibit medical personnel from disclosing personal health information to others without proper consent.
For most people, the logical choice for proxy is family members. It is important to realize that the person chosen will have access to sensitive financial and medical information, so choosing wisely is crucial. Instead of relatives, proxies can also be financial planners, attorneys, or a personal friend.
In most situations, it is a good idea to appoint an agent for both the financial and medical durable power of attorney. While not required, having a person in charge can be more efficient. If this is not feasible, it is better to appoint two people who are able to work well together.
Establishing a POA is also an important estate planning strategy. One of the most valuable gifts someone can give their family is to make sure their affairs are in order. Resolving the estate of loved ones can be a complicated issue if no directives are provided in a last will and testament.
Writing a will helps speed up the probate process used in the US to settle the estates of the deceased. Wills are necessary to ensure loved ones receive the inheritance property you want them to have. They are also used to establish guardianship of minor children and attach a personal representative to handle estate matters.
Both wills and durable power of attorney forms give authority to those charged with specific duties and help make their jobs easier. For a nominal fee and a few hours of time, these documents provide the peace of mind that everything is in order should the unthinkable happen.