There are different types of powers of attorney, and some of them are particularly useful when you are engaged in the process of incapacity planning.
Powers of attorney are utilized to name an agent to be able to act in your behalf in some type of legally binding capacity. A general power of attorney would give sweeping powers, but you could also create a power of attorney that gives limited powers. This could be the ability to enter into some type of contract in your behalf on a one-time basis.
Standard powers of attorney do not remain in effect after the incapacitation of the grantor. Therefore, when you’re planning for the possibility of incapacity you would want to execute durable powers of attorney. These devices stay intact even if the grantor becomes incapacitated at some point in time.
However, you may not want to give this power to someone until and unless you do in fact become incapacitated. This can be achieved through the execution of a springing durable power of attorney.
As the name implies, this POA springs into effect only after the grantor becomes incapacitated.
While this may sound like a very useful tool, there is the potential for some difficulties because the attorney-in-fact is going to be required to prove that the grantor is in fact incapacitated. This is a great protection on the one hand, but it can be problematic on another level under certain circumstances.
This is a very brief, surface explanation. To learn more about powers of attorney set up a consultation with a licensed estate planning lawyer.
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Ryan M. DenmanandDennis D. Duffy
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