Power of Attorney
A Power of Attorney (POA) is a legal document that allows a person, known as the principal, to appoint another person or entity, known as the agent or attorney-in-fact, to manage their affairs, make legal decisions, and conduct transactions on their behalf.
There are several types of Power of Attorney, each with different scopes and purposes:
- General Power of Attorney: This grants the attorney-in-fact broad powers to act on behalf of the principal in a range of situations, like handling financial and business transactions, buying life insurance, operating business interests, making gifts, and employing professional help.
- Special or Limited Power of Attorney: This specifies the powers granted to the attorney-in-fact and is typically used for specific transactions, like selling a house or managing specific assets.
- Health Care Power of Attorney: This gives the attorney-in-fact the authority to make health care decisions on behalf of the principal if they become incapacitated and unable to make these decisions themselves.
- Durable Power of Attorney: This remains in effect even if the principal becomes mentally incapacitated. Unless specified as “durable,” a POA is usually terminated when the principal dies or becomes incapacitated.
- Springing Power of Attorney: This only becomes effective in specified circumstances, typically when the principal becomes incapacitated.
It’s important to consult with a legal professional when considering a Power of Attorney, as laws and regulations can vary by location and personal circumstances.