Friday, May 31, 2013

Top Reasons to Create Power of Attorney

People are often confused about power of attorney and if they need it. The simple answer is nearly everyone can benefit from these legal forms. However, it's advisable to become informed about the various types and their uses.

Power of attorney forms are needed to designate an agent to conduct business or personal transactions on your behalf. They are also required to authorize agents to be involved with healthcare decisions if you are unable to communicate.

There are laws in place that forbid unauthorized people from accessing bank accounts, using credit cards, or buying or selling titled property. The only way to give permission to others is to prepare power of attorney forms.

The type used depends upon the transactions agents are involved with. Some forms let agents perform a wide variety of tasks, while others are limited to a specific duty. Each has a unique purpose, but can be customized to address the needs of each individual. Three of the most popular are general, limited, and medical.

General power of attorney allows agents to carry out many duties. They are often used by companies to ensure business operations can continue in the absence of senior management or partners.

They can also be used to let a company or professional act as a negotiator. For example, if a person owes money to creditors or the IRS they can hire a lawyer to enter into a deal. Or, a real estate investor could authorize an agent to buy and sell properties or act as a property manager.

Power of attorney forms normally do not have to be recorded through local courts. However, if they are used in association with real estate transactions then they might need to be filed with the county clerk's office. Furthermore, whenever agent powers are revoked another POA has to be recorded to document removal of privileges.

Limited power of attorney is used when agents are responsible for performing a specific task. Once agents carry out the assigned task their privileges are automatically revoked and the form is null and void.

Duties can range from basic tasks, such as balancing a checkbook to complex tasks, such as selling an automobile or real estate. As a rule of thumb, if a transaction requires your signature a form should be created to let someone else take care of things if you're unable to do so.

Medical power of attorney is one of the more important forms. Every adult should create one to ensure they have a voice in their medical care, even if they can't speak. This form grants agents the right to be involved with medical decisions regarding your care. It is also used to define any lifesaving procedures you desire or are against.

Agents do not get involved until a person is declared incapacitated by a medical doctor. It is advisable to openly communicate your wishes regarding treatments or procedures. Doing so will assist them in making choices that are in alignment with yours.

For the most part, spouses and relatives are designated as healthcare agents, but the choice is completely up to you. The only requirement is that agents are at least 18 years of age.
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