Power of attorney is a legal authorization that allows one person to make legal decisions and act for another party. There are many different situations when granting power of attorney to someone you love and trust is in your best interest.
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To get power of attorney follow these steps.
Determine the type of power of attorney you need. There are two types of power of attorney, general and specific. General power of attorney authorizes the other person to act as legal representative in financial matters for an undefined period of time and undefined scope. A specific power limits or restricts the power to a single transaction or type of transactions.
Be aware of the risks. Granting someone power of attorney allows the agent to borrow money, file tax returns and collect social security benefits in the other person’s name. A person with power of attorney can make legal, financial and medical decisions in many cases so it is important that both parties be aware of the risks and responsibilities before drawing up the paperwork.
Write it down. Before heading to an attorney, write down the reasons for the power of attorney and what is covered. This will help the attorney determine what type of power – general or specific – is needed if you couldn’t decide in step one.
Clarify all assets. Make sure that all the assets and liabilities are documented so that they may be included in the power of attorney form. The agent (who is given power) needs to be informed to make the best decisions.
See an attorney. There are online legal forms and agents who will draw up a power of attorney for cheap. These documents may or may not bear testing under legal scrutiny. To avoid future hassles or disagreements, it is best to consult with an attorney who can draw up the document as well as make sure that both parties are well informed of their rights and obligations under the document. The attorney will also retain a copy of the document in case it is needed later for a legal dispute.
Gather witnesses. Power of attorney forms, like many legal documentations, needs to be signed and witnessed.
Power of attorney is valuable for people with medical disability, illness or incapacitation. With the number of senior citizens becoming incapable of managing their own care, the use of power of attorney is becoming more widespread. If you are caring for a relative or will be in the future, your best option is to clarify the needs and goals before anyone becomes incapacitated. Drafting a power of attorney helps this process.
