You are probably aware of the fact that a power of attorney is a legal document that you could use to give someone else the power to make decisions on your behalf that would be legally binding. There are various different reasons why you may want to use a power of attorney when you are fully capable of handling your own affairs.
For example, you may be out of the country on business for an extended period of time, and you may give an associate the power to enter into certain business transactions on your behalf. A power of attorney could also be called for if you were convalescing after an injury or illness.
These are a couple of possible scenarios, but there are others.
Elder Law Implications
As estate planning and elder law attorneys, we help people prepare for the eventualities of aging. Unfortunately, a significant percentage of senior citizens become unable to make sound decisions on their own at some point in time.
There are those who cannot communicate due to physical ailments, and there is also mental incapacitation that can enter the picture. Alzheimer’s disease is quite common, and this disease is not the only cause of incapacitation.
A guardian could be appointed by the state to manage your affairs in the event of your incapacitation if you do nothing to prepare in advance. You can prevent a guardianship and empower your own hand-picked decision-makers through the execution of durable powers of attorney.
When a power of attorney is specifically designated as durable, it would remain in effect if you become incapacitated. An incapacity plan will typically include a durable financial power of attorney, and a durable power of attorney for health care decision-making.
You may understand the value of a durable power of attorney, but you may be concerned about a loss of control. If your durable powers of attorney become effective immediately, the agents would be empowered to act on your behalf, even if you are fully capable of handling your affairs.
However, you do not have to inform the agents that you name in the documents right away. You could have your attorney store the durable powers of attorney. When and if you decide that you want the agents to know that you have empowered them to act on your behalf, you can contact your attorney and let the agents know about the existence of the documents.
This is one idea, but there is another option that you could exercise. It is possible to create a springing durable power of attorney. This type of power of attorney would only go into effect if you become incapacitated.
Learn More About Incapacity Planning
If you would like to obtain more detailed information about incapacity planning, download our special report. The report is free, and you can click the following link to access your copy: Indianapolis IN Incapacity Planning.
Mr. Kraft assists clients primarily in the areas of estate planning and administration, Medicaid planning, federal and state taxation, real estate and corporate law, bringing the added perspective of an accounting background to his work.