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Durable Financial Power of Attorney Form

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Durable power of attorney is a form that allows a person to elect someone else to be able to handle financial decisions related to personal and real property on their behalf while conscious or incapable of making their own decisions (incapacitated). The principal will usually want to select an agent along with a ‘successor’ or ‘secondary’ agent, in the chance the first individual selected is not available, that they can trust in the event they are not able to represent themselves. The form is valid, in most States, until the death or Revocation by the principal. It is recommended, although not required in some States, to have the document notarized and at the very least witnessed by two (2) non-family persons.

by State

Table of Contents

Durable POA vs General POA

Both forms allow for the principal to select someone else to act in their behalf. Although, the durable allows for the relationship to continue in the event the principal is not able to think competently any longer. This could be sue to a multitude of reasons most commonly to Alzheimer’s Disease, dementia, coma, or any condition that would severely impair the mind of the principal.

If the principal would rather have their agent(s) no longer have the power to act on their behalf in the event they are incapacitated, but have possess the full responsibility while they are of sound mind, the principal will want to fill-in a general financial power of attorney.

Financial Responsibilities

The agent, or attorney-in-fact, will play the most important role in this document as he or she will be able to conduct any type of financial act as if they were in your shoes. Therefore, you not only want someone who you trust, but also someone that you believe has the judgment to make good decisions concerning your wealth or business.

The Principal may select all or just some of the following to have during the agent’s tenure:

Banking – To be able to withdraw and deposit money in the principal’s bank accounts. In addition, the agent may use the money to write checks to pay bills on behalf of the principal.

Safe Deposit Box – If there is a safety deposit box the agent will have access to it including any and all of the contents included thereof. Even if there is not a key this form gives the license to drill and open the box any means possible.

Lending Money – To freely allow others to borrow money that the agent deems credible. This can be in the form of promissory notes, I owe you’s, or any type of loan agreement to the benefit of the principal.

Government Benefits – If the principal is enrolled in any type of benefits this allows the agent to make any type of decisions to edit, create, or terminate plans.

Taxes – The act of filing State and Federal taxes on behalf of the principal. If there is a business connected to their name this allows any and all sales, employment, or real estate taxes to be paid as well.

Insurance – To be able to coordinate any type of insurance whether it be for business or personal use as best fit for the principal.

Real Estate – Any type of action whether it be to purchase, sell, mortgage, lease, refinance, or any type of handling of real property. If a property is sold all funds must be made to the benefit to the principal.

Personal Property – To buy, sell, or exchange any type of personal asset. This could be as simple as buying tools to make home repairs on the principal’s behalf to selling jewelry in order to pay the bills.

Gifts – The power to make gifts on behalf of the principal for any reason. This can sometimes bring about some legal liability and usually the gifts only are deemed pure in the eyes of the courts is if there is some tax benefit to the principal for granting the gift.

Litigation – If the principal is currently or in the future involved in a lawsuit this allows the agent to handle any court related actions.

Authorizing a Power of Attorney

In most States it requires either the signature of two (2) witnesses (that are not related to the principal) or a notary public. In some States both are required (two (2) witnesses and a notary public).

It is a very serious form and it is why States go to great lengths to ensure that when the form is completed that it is to the wishes of the principal.

Agent’s Acceptance of Appointment

At the end of the form the Agent must read and acknowledge the power that they have and how important their position is for the principal. This addendum is recommended to be attached as it is required in some States.

Durability – Ensure yourself one last time that the person you have selected will have the power to make your decisions while incapacitated.

Medical Decisions

If so, then you will want to complete the Medical Power of Attorney so that you can instill your wishes in the form in addition to having a trusted person make the best decisions on your behalf. The durable form does not cover health care related decisions, only financial.

In addition, the medical power of attorney contains a Living Will, (the combination is legally referred to as the Advance Directive) and allows you to make end of life decisions. Such decisions would include whether or not you would like to have food, hydration, artificial breathing, and if you would like your organs to be donated after your death.

Where to File

For the most part the document, and any copies, are to be held by the parties involved. It is recommended to have a copy immediately forwarded to the principal’s attorney after singing, but otherwise the form is left with the agent and their immediate family.

Some States have a department where the principal may opt to send the document after it has been completed where it can be accessed at anytime.

State Laws

How to Write

Before filling-in, the principal should recognize that the document they are about to write gives ultimate power (where initialed) to the person(s) they select to handle actions on their behalf while they are of sound mind and if they should become incapacitated. Therefore it is especially recommended that the individual(s) selected are trustworthy such as family or close friends or business partners.

Step 1 – Enter the following in the first (1st) paragraph enter the date of the agreement and the:

  • Principal’s full name, street address, city, and State;
  • Attorney-in-fact’s full name, street address, street address, city, and State.

Step 2 – Under the heading EFFECT DATE initial either if the principal would like to have the powers be available to the attorney-in-fact immediately or only when the incapacitation should take place.

Step 3 – Under most State laws, the principal will have to initial next to each power they are granting to their agent including but not limited to:

  • Banking;
  • Safety Deposit Boxes;
  • Lending or Borrowing of Money;
  • All Types of Government Benefits;
  • Retirement Accounts;
  • Taxes (Filing);
  • Insurance;
  • Real Estate;
  • Personal Property & Assets;
  • Real Estate (Management);
  • Gifts;
  • Legal Advice;
  • Special Instructions (Other) – Initial and complete with description.

Step 4 – Enter the State the principal is a resident.

Step 5 – When signing it is important to know that most States require, at the very least, two (2) witnesses (not family related) or a notary public to acknowledge the parties. The principal and attorney-in-fact must be present when signing in front of the witnesses or notary public.

Step 6 – Some States require the attorney-in-fact authorize an Acknowledgment of their duties acting in the in the best interests of the principal. In addition to the original document, the individual should sign in front of a notary public.

Step 7 – Several originals should be made for each party and be kept in a safe place. Most States do not require the filing with any government agency and should be given to any and all financial institutions to inform them of the new designation. Form must be presented by the attorney-in-fact whenever representing the principal.