Power of attorney forms give authorization for a representative to act in specific legal matters on behalf of an individual. The individual – referred to as the grantor, principal, or donor – fills out a power of attorney form, which can be general or give very specific powers, and the representative – referred to as the agent or attorney-in-fact. Both parties sign the document before at least one witness, and a notary signs as well.
Power of attorney documents are strict legal documents that hold up in court. These documents grant powers ranging from access to bank accounts and stocks, to the ability to sell property, to the ability to make healthcare decisions on behalf of the grantor.
These types of documents are most frequently used when the grantor falls ill or is incapacitated in some way, and needs assistance from another person. For example, if the grantor falls into a coma, then their agent may continue running their business, paying their bills, make financial decisions to ensure the stability of the grantor and the family involved, and can even relate medical treatment wishes that the grantor has specified.
In some cases, when the grantor recovers enough to take over their finances and healthcare decisions with sound mind, the powers of attorney granted to the agent are revoked. These powers are only temporary, and are only in play while the grantor is alive but unable to make their own decisions or incapacitated in some way.
General Powers & Will
Unlike wills or estate planning documents, power of attorney documents do not carry power over to the agent after the grantor dies. If you are creating general power of attorney documents to ensure that you have assistance if you fall ill or are incapacitated, consider also creating a will in the event of your death. You do not have to name the same person as agent for your power of attorney and you will or estate planning documents. If you do not plan for certain legal powers to transfer after your death, your next of kin will be granted legal power to distribute your estate after your death, or your estate will go to probate court.
Power of attorney documents ensure that a grantor has legal, financial, and medical representation if and when they become incapacitated while they are alive. In some cases, people wish to divide up powers of attorney among different individuals – for example, their spouse may be better able to make healthcare decisions, while a friend would be a better financial representative. However, many people choose to fill out general power of attorney documents, and choose one agent to help them through difficult times.
Most states in the US require at least one witness and a notary to sign the power of attorney documents. These documents cannot be verbal agreements, especially if close family may disagree with the grantor’s decision. Powers of attorney can only be granted with a written document, which is signed and notarized. The notary ensures that the grantor is of sound mind when signing.
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