There are times in life you may not be present or able to handle a decision or legal matter for yourself. In those cases, it can help to have someone you trust with the power to handle the matter on your behalf. A power of attorney form can grant that ability, but you obviously want to be careful in handing out such capabilities.

Learn more about what a power of attorney is below, including whether there are limitations to this power and how they might protect you.

What Is a Power of Attorney?

A power of attorney (POA) is a legal document that gives someone specific power to act on your behalf. The document itself can limit these powers. You might create a POA for a very specific purpose, such as allowing someone to buy insurance on your behalf because you can’t be present to do it yourself. Or, you can create a more general POA that allows someone to manage your financial matters.

Different Types of Power of Attorney
Because you can create and customize a power of attorney to meet specific needs, there are unlimited iterations on this legal option. There are, however, some overall categories of POAs within which these iterations fall:

  • Medical POAs. Medical power of attorney forms deal specifically with your wishes about your own healthcare. You can record desires for a variety of medical decisions, including what treatments you do or do not want in certain cases and which providers you prefer. You also name a person to make decisions that aren’t specifically spelled out in your POA. If you are incapacitated and unable to communicate your own decisions, doctors and others will turn to your medical POA for decision-making. A medical power of attorney is often referred to as a “health care directive,” “health care proxy,” “living will,” or “health care power of attorney.”
  • Financial POAs. A financial POA gives someone the ability to make financial decisions on your behalf. They may be able to pay your bills, cash checks in your name, handle investments, or otherwise manage your money. You can set up a financial POA as a durable POA (see below) if you want someone to handle such matters if you are incapacitated.
  • Durable POAs. A durable power of attorney allows the agent you name to act on your behalf even if you are incapacitated. A medical power of attorney is typically a durable power of attorney, but you can have a durable POA that deals with financial decisions or other matters too.
  • Springing POA. A springing power of attorney is one which is effective only upon the occurrence of a triggering event. For example, you may create a POA that allows your spouse to sign documents for you only if you are incapacitated. If you are not incapacitated, the POA is not effective.
  • General POA. This type of POA allows your chosen agent to act on your behalf in any situation allowed by law. It’s the most overarching POA and gives the agent you choose the most power.

When Does Power of Attorney Take Effect (and End)?

Powers of attorney take effect on a date and time detailed by the POA form or upon a springing event. In the case of a durable power of attorney, the springing event is generally the incapacitation of the person creating the POA.

When a POA ends depends on the document. You can provide a specific time period or limit the POA to certain situations or events. For example, a husband might give his wife POA power to sign mortgage paperwork during the closing because he’s traveling for business. In this case, the POA would be limited solely to the closing and to signing those documents.

Importantly, a POA is only effective during your life. At death, the document is no longer effective.

What Are Some Common Limits on a Power of Attorney?

In addition to the limitations that are built into the power of attorney form, such as the springing event and when the POA powers are no longer effective, there are certain things a POA can’t do. This is true even if you give someone unrestricted general POA.

A POA agent can’t enter into a marriage on your behalf without you knowing about it and setting up other provisions for the matter. They also can’t make changes to your will or create a will on your behalf.

Despite the name, a power of attorney has no official ability to act as an attorney unless they are a licensed lawyer. They can’t bring a lawsuit on your behalf, for example. However, they can hire an attorney to bring a lawsuit on your behalf if the power to do so is allowed by your POA form.

Who Can Be a Power of Attorney?

Almost any adult over the age of 18 can be a power of attorney. They do have to be deemed of sound mind, and in cases where the court believes a POA has abused his or her privilege, the court may remove the POA.

When choosing an agent to act as a power of attorney, you obviously want to choose someone you trust. You should consider their suitability for the role. For example, you probably don’t want to pick someone who is bad with money to be the agent for your financial POA.

It’s also a good idea to talk to the person you choose before you finalize POA paperwork. Make sure they are willing to undertake this responsibility.

To create a POA form or start the process of estate planning, contact the Stone Arch Law Office today.