What is a Power of Attorney, and Do I Need One?
A power of attorney (POA) is a legal document that grants another person the authority to act as your agent on your behalf. It is commonly used in estate planning and situations where an individual is unable to make decisions or take actions independently.
Types of Powers of Attorney
There are different types of powers of attorney, including financial powers of attorney, durable powers of attorney, and health care powers of attorney. Determining the right type of power of attorney for your specific situation is best handled by an experienced attorney who can ensure that it is tailored to your needs while protecting your interests.
Granted Powers
The authority granted to your agent through a power of attorney depends on the specific type and content of the document. Powers of attorney can be general, limited, or temporary. A general power of attorney provides broader powers to another person, while a limited or temporary power of attorney is more restrictive. Temporary and special powers of attorney are valid for specific time periods or events, as specified in the document.
Understanding Durable Power of Attorney
A durable power of attorney remains valid even if you become incapacitated or unable to act on your own. This type of power of attorney is crucial as it allows another person to step in and act on your behalf in such situation and can be crafted to only become effective upon the occurrence of an incapacitating event, known as springing powers.
Limitations of Power of Attorney
The authority granted to an agent through a power of attorney is limited to those powers specified in the document. Powers commonly granted in powers of attorney include decisions related to real estate, financial accounts, personal property, investments, taxes, and other assets. However, there are certain actions that an agent cannot perform on your behalf, such as entering into a marriage, changing beneficiaries, or signing a will. Additionally, an agent cannot transfer powers to another person without your permission.
Reviewing Your Power of Attorney
If you already have a power of attorney as part of your estate plan or for contingency purposes, it is a good idea to periodically review your estate planning documents with a knowledgeable lawyer. This is particularly important if your power of attorney was created before 2018 when North Carolina revised the laws pertaining to powers of attorney. While documents created prior to 2018 remain valid and enforceable, they may not offer the same level of protection as a recently revised power of attorney. Consult with a lawyer to have your power of attorney reviewed, to ensure it aligns with your current goals and objectives.
We Can Help
Whether you require a power of attorney or need an existing one reviewed, revised, or revoked, the attorneys at Hopper Cummings are here to assist you. We possess extensive experience in creating estate planning documents that protect you and can help you make informed decisions about your personal plan. Contact us today for a confidential consultation at 919-533-4115 or complete our online form.
