General power of attorney authorizes an agent to act on your behalf regarding certain matters such as financial and legal issues. However, one drawback of a general power of attorney is that this type of legal protection actually ends if a person becomes incapacitated, which is when they might need power of attorney most of all.
A durable power of attorney, on the other hand, has the advantage that it remains effective even if a person suffers any kind of incapacitation. Therefore, a durable power of attorney can be useful for ensuring your financial, legal, and healthcare affairs will be taken care of in case of any unforeseen circumstances such as medical emergencies or cognitive decline. The person you appoint will be your â€œattorney-in-factâ€ or agent.
What Does an Attorney-in-Fact Do?
An attorney-in-fact with a durable power of attorney can handle many different types of situations and transactions for you should you become incapacitated, including:
- Managing your financial accounts such as bank accounts and investments
- Filing your taxes
- Managing your healthcare
- Buying and selling property
According to the American Association of Retired Persons (AARP), almost half of all adults in the United States do not have a medical power of attorney in place.
Who Can Serve as An Attorney-in-Fact?
Generally, anyone 18 years of age and over can potentially act as your attorney-in-fact with a durable power of attorney. They do not have to be an actual attorney. Attorneys and financial institutions can also act as agents. However, since this person will potentially be handling crucially important decisions on your behalf, you should choose someone with your full trust. Typically, individuals tend to name a spouse or adult child as their agent. However, you could also appoint a close friend or professional advisor, for instance. It can also be important to name a successor in case your attorney-in-fact is unable to act as your agent or unavailable when you become incapacitated.
What If I Do Not Have a Durable Power of Attorney?
According to the American Bar Association (ABA), if you become incapacitated and unable to manage your financial, legal, and medical affairs and do not have a durable power of attorney in place, a court may appoint someone to act for you. This means that you could lose the ability to choose who will handle your affairs. In addition, this court supervised guardianship is an expensive and time-consuming process that requires on-going and publicly available reporting. Therefore, being proactive and establishing a durable power of attorney means you can appoint an agent of your trust.
How to Terminate a Durable Power of Attorney
Power of attorney can naturally terminate with the death of the â€œprincipalâ€, the individual who has set up a durable power of attorney for themselves. However, you can generally terminate or revoke power of attorney at any time. Courts can also invalidate powers of attorney. When an agent decides to step down, a durable power of attorney agreement will also come to an end.
Learn How the Experienced Estate Planning Attorneys at Hailey-Petty Law Firm, PLLC Can Help
Using an experienced estate planning attorney to draw up your power of attorney documentation can be crucial for ensuring legal validity. Unfortunately, issues with powers of attorney tend to surface when it is usually too late to do anything about them.
While there are templates for power of attorney documents on the internet, consider that your paperwork needs to:
- Accurately cover the legal requirements of the state of Texas
- Represent your specific circumstances and wishes
- Be current
- Contain unambiguous language
A knowledgeable estate planning attorney from our firm can help you with all aspects of estate planning, including setting up a durable power of attorney. Contact Hailey Petty Law Firm, PLLC today to schedule a free 30-minute consultation at 512-910-8977 (Austin) or 210-570-2458 (San Antonio).
*Note: additional fees may apply for consultations longer than the allotted 30 minutes.