A power of attorney (POA) is a legal document usually included in most estate planning. It allows an appointed person (referred to as ‘the agent’) to make decisions on your behalf regarding legal, financial and property matters if you ever become incapacitated. The person appointed as POA has many decision-making powers; however, they are unable to make decisions about lifestyle, health and accommodations. The POA gives the appointee the ability to make financial decisions on your behalf. It is important to note that the person assigned to be POA does not need to be an attorney. The person can be a trusted friend or family member. Power of Attorney is frequently used in the event of an illness or disability or when you can’t be present to sign legal forms. Without a POA, no one can represent you or your interests unless they are appointed by a court.
Power of Attorney
There are four types of Power of Attorney: Limited, General, Durable and Springing.
Limited Power of Attorney
In a limited power of attorney, power is restricted to specific transactions. It may allow someone to sign a deed to a property or sign checks for you if you are unable to.
General Power of Attorney
A general power of attorney gives the appointed person the same powers and rights that you have. This means that someone who has general power of attorney can handle bank accounts, write checks or sell assets such as property.
Durable Power of Attorney
A Durable Power of Attorney gives the appointed person the power to make decisions now and if you become incompetent. It permits another person to act for you even if you lose the ability to understand the purpose of the POA after signing the document.
Springing Power of Attorney
A Springing Power of Attorney limits the agent to making decisions only when and if you become incompetent. Most powers of attorney take effect immediately, however, they can also be written so that they do not become effective until an incapacity occurs. If it is written in this way, parameters must be set to identify the standard for determining incapacity.
A power of attorney can be revoked at any time as long as you still have the mental capacity to do so. A POA must be written while you are competent. If you are not competent enough to execute a POA, a guardianship may be necessary.
Assisting Clients With Power of Attorney in NJ For Over 30 Years
Power of Attorney is a necessary part of any good estate plan. It can be complex and overwhelming, but with over thirty years of experience assisting the community, Davison Eastman Muñoz Paone, P.A, can help you create the best estate plan for your family’s needs. Our firm has law offices conveniently located in Freehold and Toms River.