Power of attorney forms are legal documents that are completed by a Principal to appoint an Attorney In Fact/Agent, to act on their behalf in the event of extended absence, illness, disability or for needs requiring proof of an Agent’s authorization. Power of attorney forms vary in nature. Depending upon the selected document, the Principal may choose to consult with an attorney to unsurely understand the document being completed.
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Rhode Island
- South Carolina
- South Dakota
- West Virginia
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Durable (Financial) Power of Attorney – The most common type of power of attorney, allows a person to grant someone else the unrestricted ability to handle financial transactions on behalf of the principal.
General (Financial) Power of Attorney – Grants the same financial powers listed in the durable form except that it does not remain in effect if the principal becomes incapacitated or mentally disabled.
IRS Power of Attorney (Form 2848) – Revised in Dec. 2015, allows an individual or business entity to elect a party, usually an accountant or tax attorney, to file federal taxes on their behalf.
Limited Power of Attorney – Permits a person to carry-out a specific activity on the principal’s behalf either as a one (1) time occurrence or for a specific period of time.
Medical (Health Care) Power of Attorney – Used by an individual to select someone to handle their health care decisions in the chance they are not able to do so on their own.
Minor Child Power of Attorney – Allows a parent to give the full responsibility of their son or daughter to someone else (except adoption rights). Valid for a temporary period of time, usually between six (6) months to one (1) year, which is dependent on the State’s laws.
Real Estate Power of Attorney – For a buyer or seller of property that would like to hand-over their rights in relation to handling the negotiation and transaction at closing.
Revocation of a Power of Attorney – To cancel a current power of attorney arrangement.
Tax Filing Power of Attorney – Used to elect a tax preparer to handle a filing on behalf of an individual or entity. May be for State or Federal filings.
Vehicle Power of Attorney – Typically provided by a State’s Department of Motor Vehicles (DMV) or related agency to allow another person to sell, register, or title an automobile.
A: When an individual wants to allow another person or entity to make decisions on their behalf, a power of attorney (POA) is used. If you allow someone to act on your behalf, you are the “Principal“. The person or entity acting on your behalf is known as the “Agent“.
A: People most frequently use a power of attorney for financial or health care reasons. Say you want someone to act on your behalf for when you fall ill in the future, you would use a Medical (Health Care) Power of Attorney so your agent could make health care decisions on your behalf. If you are in a rare situation and want to give specific powers that aren’t financially or medically related, you can create a Limited (Special) Power of Attorney.
A: Many people think that you need to submit your power of attorney with the government however that is incorrect. Many states require that your power of attorney be notarized to ensure that the signatures are true, which is to help detour fraud. Only the Principal needs to be present with the notary for the Power of Attorney to be notarized. You can find a notary at any banking or financial institution. The easiest way is to go to a banking institution that you are associated with, as they will usually do it for free. The last step is to make a copy of the power of attorney and give it to your agent and keep the original with you in a safe place.
A: If you select to use a durable power of attorney, the powers you give to your agent will remain in effect if and when you become incompetent. Since one of the primary reasons to have a power of attorney is to make sure someone is there to make decisions on your behalf if and when you can’t make them for yourself, it’s a very popular choice to have your power of attorney be durable.
A: The power of attorney must be tailored for the state in which your parent resides. It does not matter which state you live in, as long as the power of attorney is applicable to the Principal’s state of residence, which in this case is your parent, is what matters.
Before the Principal writes this form they should keep in mind that the Agent (or ‘Attorney-in-Fact’) will need to be present at the time of signature along with signing in the presence of a notary public or two (2) witnesses (depending on the State).
This is a guide on fill-in a Durable Power of Attorney ONLY (Financial purposes)
Step 1 – In the header area, the following should be entered:
- Date of the form being created/signed
- Name and Address of the Principal
- Name and Address of the Agent/Attorney-in-Fact
Step 2 – The Effective Date should be entered by the Principal placing their initials whether they want the document to begin immediately or to begin when a licensed physician has deemed the Principal to be incapacitated (this is also known as a “Springing Power of Attorney”).
- Banking – To be able to deposit or withdraw funds in addition to conducting any type of financial transaction that the Principal could also do themselves. Upon the initials on this line the Agent will have the full capacity to
- Safe Deposit Boxes – This allows the Agent to have access to any safe deposit box that the Principal has possession or control of. Even if the Agent was not granted a key to the box, as long as it is in the control of the Principal the Agent may have access to it by any means possible (i.e. drilling or accessing through alternative methods).
- Lending or Borrowing – The Agent shall obtain the right to make loans under the name of the Principal and to the Principal’s best interest. It is recommended that all loans made be completed with security (Secured Promissory Note) as to protect the financial status of the Principal.
- Government Benefits – The Agent will have full control over the handling of all government assistance including but not limited to Social Security, Medicare, and Medicaid.
- Retirement Plans – If the Principal owns any IRA’s, 401(k)’s, or any other retirement plans with benefits that the Agent may have the vested power to alter or withdraw any funds from the account they deem to be to the best interest of the Principal.
- Taxes – Such as every United States citizen has the obligation to pay local, State, and Federal taxes, this allows the Agent to file for the Principal. Most likely a copy of this power of attorney will be needed to be attached to all filings made.
- Insurance – Any type of Auto, Home, or Life insurance maybe changed, accepted, or discontinued by the Agent in the chance he or she deems it as a benefit to the Principal.
- Real Estate – All property that the Principal has an ownership interest in shall be at the disposal of the Agent. In short, this means that any property the Principal has ownership in can be sold or leased by the Agent.
- Personal Property – The Agent shall have the right to acquire, purchase, exchange, lease, or sell any type of personal item. This means that the Agent can use the funds by the Principal to purchase a necessary item or sell assets that the Agent’s deems to be in the Principal’s best interest.
- Power to Manage Property – If the Principal has a house, apartment building, or commercial property the Agent has the right to sign leases or otherwise manage the premises (such as placing a home or residence on Airbnb for short-term rentals.
- Gifts – Making gifts to others on behalf of the Principal is a major legal liability although it is allowed in most States. This is something that the Agent should be very careful about doing as if the Principal becomes incapacitated with death imminent in the near-future the Probate Court, after the Principal passes away, may claim the gifts were unauthorized or illegal transfers of assets.
- Legal Advice and Proceedings – If the Principal is currently involved in any type of litigation or in need of legal help the Agent may make decisions as best to handle the said legal proceedings.
- Special Instructions – If the Principal has any other powers they wish to place in the hands of the Agent that were not already mentioned it should be listed in this area and initialed by the Principal.
Step 4 – The Agent and Principal must sign the document. Their signatures must either be witnessed by two (2) non-family members (or related by marriage) or a notary public (or in some States, both).
Step 5 – Most States require that the Agent sign an Acceptance Form authorizing that they know the powers being vested in them by the Principal and that they agree to always make decisions to the best interest and benefit of the Principal.