POA

Can I Revoke a Power of Attorney?

Sometimes it may become necessary to revoke a Power of Attorney, like in the following story, which takes an unpleasant twist after Cindy’s stepsister Charlotte suggests that she be given power of attorney to help Cindy with her business matters. When Cindy agrees, Charlotte’s attorney creates a Durable Power of Attorney that names Charlotte as her agent. What happened next, according to the Glen Rose Reporter in the article “Guarding against the evil stepsister,” was a nightmare.

Revoke a Power of Attorney
A power of attorney can be revoked at any time.

A few weeks later, Cindy’s brother Prince found that Charlotte had moved money from Cindy’s personal bank accounts into a completely different bank, setting up joint accounts in Cindy and Charlotte’s names and granting Charlotte right of survivorship (ROS). This made Charlotte the legal owner of the account at the time of Cindy’s passing. Charlotte had also contacted Cindy’s former employer and was attempting to wrest control of Cindy’s pension. It wasn’t clear whether she was attempting to obtain the entire amount in a lump sum, but she was attempting to gain control.

Cindy realized that Charlotte was not to be trusted. However, Charlotte had the power of attorney, and all of these actions were legal. Could Cindy revoke the power of attorney that she had signed? The answer is yes, which is important to know.

There were two paths available to Cindy: she could immediately execute a revocation of the Durable Power of Attorney that had been used to give Charlotte authority, or have her attorney create a new power of attorney granting power of agency to another person. Either way, Charlotte would be stripped of the legal authority to act on Cindy’s behalf.

Cindy had a new POA created, naming her brother Prince as her agent. The new POA had to immediately be presented to all of the financial institutions she deals with. She contacted her former employer and gave them proper notice that Charlotte no longer had authority to represent her. The new joint accounts that Charlotte had opened were then closed and individual accounts in her name only were open, which also ended the ROS.

Cindy had to anticipate another challenge—that Charlotte might attempt to have Cindy declared incompetent and have herself named as Cindy’s legal guardian. To protect herself, Cindy’s estate planning attorney drew up documents stating that in the event Cindy ever needed someone to be her guardian, she did not want Charlotte to be named. In addition, she named the person she would want to be her guardian, if that is necessary in the future. While a judge ultimately has final discretion, the courts generally prefer naming a guardian as requested by an individual.

Your estate planning attorney can revoke a power of attorney at any time you’d like, especially if it becomes clear that the person you’ve named is not acting in your best interests. Having an estate plan in place in advance of any medical or mental challenges is always better, so that you are less vulnerable to anyone trying to take advantage of you during a difficult time.

Reference: Glen Rose Reporter (Sep. 10, 2020) “Guarding against the evil stepsister”

The Second Most Powerful Estate Planning Document: Power of Attorney

All too often, people wait until it’s too late to execute a power of attorney. It’s uncomfortable to think about giving someone full access to our finances, while we are still competent. Some estate planning attorneys believe that the power of attorney, or POA, is actually the second most important estate planning document after a will. Here’s what a POA can do for you.

The term POA is a reference to the document, but it also is used to refer to the person named as the agent in the document.

Generally speaking, any POA creates a fiduciary relationship, for either legal or financial purposes. A Medical or Healthcare POA creates a relationship for healthcare decisions. Sometimes these are for a specific purpose or for a specific period of time. However, a Durable POA is created to last until death or until it is revoked. It can be created to cover a wide array of needs.

Here’s the critical fact: a POA of any kind needs to be executed, that is, agreed to and signed by a person who is competent to make legal decisions. The problem occurs when family members or spouse do not realize they need a POA until their loved one is not legally competent and does not understand what they are signing.

Incompetent or incapacitated individuals may not sign legal documents. Further, the law protects people from improperly signing, by requiring two witnesses to observe the individual signing (and in Florida and many other states it must also be notarized by a Notary Public).

The law does allow those with limited competency to sign estate planning documents, so long as they are in a moment of lucidity at the time of the signing. However, this is tricky and can be dangerous, as legal issues may be raised for all involved, if capacity is challenged later on.

If someone has become incompetent and has not executed a valid power of attorney, a loved one will need to apply for guardianship. This is a court process that is expensive, can take several months and leads to the court being involved in many aspects of the person’s life. A power of attorney can be executed quickly.

The biggest concern to executing a power of attorney, is that the person is giving an agent the control of their money and property.

Having an estate planning attorney create the power of attorney that is best suited for each individual’s situation is the most sensible way to provide the protection of a POA, without worrying about giving up control while one is competent.

Reference: The News-Enterprise (Feb. 24, 2020) “Power of attorney can be tailored to circumstances”

Everyone Should Have a Healthcare Power of Attorney

Before snowbirds begin their seasonal journey to warmer climates, it’s time to be sure that they have the important legal documents in place, advises LimaOhio.com in a recent article “Different seasons and documents, same peace of mind.” One of the most important documents that everyone should have is a healthcare power of attorney, and it should be prepared and be ready to be used at any time.

Having a healthcare power of attorney makes sense
A healthcare power of attorney is an often overlooked, but essential part of any good estate plan.

These documents name another person to make healthcare decisions, in case you are not able to make those decisions for yourself. We never think that anything will really happen to us, until it does. Having this document properly prepared and easily accessible helps our loved ones. They are the ones who will need the powers given by the document. Without it, they cannot act in a timely manner.

If traveling between a home state and a winter home, it is wise to have a set of documents that align with the laws of both states. It may be necessary to have a separate set of documents for each state, if the laws differ.

Healthcare powers of attorney typically need updating about every five years. The law has changed in recent years in Florida, and there are some specific powers that need to be stated precisely, so that the document can be used if needed.

If a healthcare power of attorney is not in place when it’s needed, the only way that someone else can make decisions for you, is to become your guardian. Guardianship takes considerably more time and costs more than preparing the document ahead of time. It should also be noted that once guardianship is established, the person who is the guardian will need to report to the court on a regular basis.

Another document that needs to be in place is a living will or advance directive. This is a document prepared to instruct others as to your wishes for end-of-life care. The document is created when a person is mentally competent and expresses their wishes for what they want to happen, if they are being kept alive by artificial means. For loved ones, this document is a blessing, as it lets them know very clearly what their family members wishes are.

Peace of mind is a wonderful thing to take with you as you prepare for a warm winter in a different climate. Talk with an estate planning attorney to be sure that your estate planning documents will be acceptable in your winter home.

Reference: LimaOhio.com (Oct. 26, 2019) “Different seasons and documents, same peace of mind”

Estate Planning Basics Everyone Should Know

The discomfort most people have with the knowledge of their own mortality makes it challenging for some people to do the estate planning that needs to take place before an emergency occurs. However, according to the Gettysburg Times’ recent article “Essentials necessary for estate planning,” the best course of action is to take care of the estate planning basics now, when there is no urgency. Having detailed plans in place to protect loved ones from possible complications, costs and added stress in the future, is a gift you can give to those you love.

Estate Planning Basics
Taking care of the estate planning basics is a simple but important step for everyone to take.

There are any number of legal documents and strategies used to accommodate the varied situations of life, including family dynamics and asset levels. An estate planning attorney licensed in your state will have the ability to create a plan and the documents that suit your personal situation. The three documents discussed in the following section are generally considered to be the most important for anyone to have.

Power of Attorney or POA—This document gives legal authority to another person or entity, referred to as your “Agent”, to perform certain acts on your behalf, when you cannot do so because of illness, injury or incapacity. There are many different types of POA, from a “full” POA with no limitations, to a “limited” POA that is created solely for a specific purpose. This document comes into action, when you are incapacitated and becomes void upon your death.

Living Will—This is a detailed health care directive that allows you to list your wishes regarding several medical procedures and life-sustaining treatments. These treatments include resuscitations, breathing assistance, feeding tubes and similar medical matters. You want to have this in place to spare your loved ones the emotional anguish of trying to decide what you would have wanted. They’ll know, because you specifically told them in this document.

Last Will and Testament—When prepared correctly, and that includes signed, witnessed, and notarized, a will is used by the “testator” (the person making the will) to provide the legal wishes regarding what should happen to their minor children (if any) and assets upon death.

What happens if you don’t have these documents? It is likely that your loved ones will need to go to court to have someone named as your agent or executor, which is the person who is in charge of your estate. Depending upon the laws of your state, that person may be a family member, or it may end up being a family member who you haven’t spoken to in decades. It is far better to take the time to have these estate planning basics taken care of by an estate planning attorney, so your family is protected, and your wishes are fulfilled.

The best time to do this, is when there is no crisis. Estate plans also require regular monitoring and updating. Life circumstances change, estate and tax laws change, and new opportunities may present themselves. Speak with your estate planning attorney now and create your plan for the future.

Reference: Gettysburg Times (July 27, 2019) “Essentials necessary for estate planning”

Power of Attorney: Why You’re Never Too Young

When that time comes, having a power of attorney is a critical document to have. The power of attorney is among a handful of estate planning documents that help with decision making, when a person is too ill, injured or lacks the mental capacity to make their own decisions. The article, “Why you’re never too young for a power of attorney” from Lancaster Online, explains what these documents are, and what purpose they serve.

Everyone over the age of 18 needs to have a Power of Attorney in place.

There are three basic power of attorney documents: financial, limited and health care.

You’re never too young or too old to have a power of attorney. If you don’t, a guardian must be appointed in a court proceeding, and they will make decisions for you. If the guardian who is appointed does not know you or your family, they may make decisions that you would not have wanted. Everyone over the age of 18 should have a power of attorney.

It’s never too early, but it could be too late. If you become incapacitated, you cannot sign a POA. Then your family is faced with needing to pursue a guardianship and will not have the ability to make decisions on your behalf, until that’s in place.

You’ll want to name someone you trust implicitly and who is also going to be available to make decisions when time is an issue.

For a medical or healthcare power of attorney, it is a great help if the person lives nearby and knows you well. For a financial power of attorney, the person may not need to live nearby, but they must be trustworthy and financially competent.

Always have back-up agents, so if your primary agent is unavailable or declines to serve, you have someone who can step in on your behalf.

You should also work with an estate planning attorney to create the power of attorney you need. You may want to assign select powers to a POA, like managing certain bank accounts but not the sale of your home, for instance. An estate planning attorney will be able to tailor the POA to your exact needs. They will also make sure to create a document that gives proper powers to the people you select. You want to ensure that you don’t create a POA that gives someone the ability to exploit you.

Any of the POAs you have created should be updated on a fairly regular basis. Over time, laws change, or your personal situation may change. Review the documents at least annually to be sure that the people you have selected are still the people you want taking care of matters for you.

Most important of all, don’t wait to have a POA created. It’s an essential part of your estate plan, along with your last will and testament.

Reference: Lancaster Online (May 15, 2019) “Why you’re never too young for a power of attorney”

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