Understanding Different Types of Power of Attorney (POA)
Types of Power of Attorney Can Be Confusing
I’ve often been confused about the different types of power of attorney (POA). Let me give you an example. When my grandmother was nearing the end of her life, she was transferred from the hospital to a nursing home for a few weeks. In getting all the paperwork completed, I was asked “who is your grandmother’s power of attorney.” I quickly replied “well I am.” And I was asked to bring in a copy of the POA paperwork to keep on file at the nursing home.
That same evening, I scoured through all the “special papers” I had accumulated for grandma and stored in a small fireproof box. I found the power of attorney papers that were drawn up just a few years earlier after grandma’s only daughter, my mother, passed away.
I delivered the papers to the nursing home the next day and was promptly told that they were not the ones they needed. I asked for clarification.
My papers specifically named me as the “general power of attorney” over financial and legal affairs only. Not healthcare.
Power of Attorney vs. a Living Will ~ Keep This in Mind
There is a difference between a Living Will and a Power of Attorney. A Living Will does not authorize anyone to make certain decisions such as taking someone off or keeping them on life support. For this reason alone, it is a good idea to have a Health Care Power of Attorney.
Grandma Was Almost 103 Years Old
At this point, my grandmother was incoherent often. When a person is unable to validly sign the legal power of attorney document, in most cases, a court must impose a conservatorship which means a court hearing must take place.
Since there were still occasions (although rare) when my grandmother would try to converse with us, I took the opportunity just a couple nights later to speak with her and try to explain why I needed her to sign a healthcare power of attorney form. I don't think she understood. After putting the pen in her hand and prompting her to sign the POA papers, she did, but it looked nothing like her signature. I felt bad. She had no idea what she was signing. But considering her age and the fact that she had been transferred to the hospice division, the nursing home did accept her signed papers with the understanding that there was not enough time to go through a court hearing.
The purpose of my family needing the healthcare power of attorney was to specify that we did not want grandma to receive any life-sustaining procedures that were invasive. We knew she didn’t want that, and she was giving us signs that this was the end of her great life and that she was okay. Yet since there was no DNR (do not resuscitate) papers in place, we at least needed the POA papers so that I (consulting with my sisters) could make decisions that were in grandma’s best interest.
There are different types of Power of Attorney used in the United States. It can be difficult to understand the difference; therefore, I hope to clearly explain what I have learned so that others will not be caught off guard like I was.
Clarification of Terms I Will Be Using
The person authorizing a power of attorney can be referred to as:
The person authorized to act as the power of attorney can be referred to as:
Power of Attorney paperwork will be referred to as:
**POWER OF ATTORNEY**
Donor (of the power)
Power of Attorney
For the purposes of the information in this article, I will be using the common terms:
PRINCIPAL ~ referring to the person authorizing the power of attorney
POA ~ referring to the person authorized to act on behalf of the Principal as their Power of Attorney
POWER OF ATTORNEY ~ referring to the actual Power of Attorney paperwork
**Free Power of Attorney Forms for the United States
**Any legal form that you utilize from the internet should always be reviewed by a legal expert.
It is always a good idea to contact a lawyer to ensure a POA form is completed correctly.
What is a Power of Attorney?
A power of attorney is a form that allows the Principal, 18 years of age or older and of sound mind, to designate a person as their POA to carry out important financial, medical or legal affairs in the case that they are unable to do so.
Although some local laws may vary, Power of Attorney documents should be stamped (notarized) by a notary public and/or include two witnesses.
More than one power of attorney can be completed. Although for each POA, separate paperwork is needed. There is no such thing as a “joint” power of attorney.
Do I Need a Power of Attorney?
A power of attorney should be completed if you wish to make sure there is an appointed person to handle your affairs in case you are incapacitated. Although it may be uncomfortable to think about, things happen such as a long-term illnesses and accidents. If you have a power of attorney in place, you will eliminate possible legal battles for your loved ones.
Can a Power of Attorney be Revoked?
Yes, it can be cancelled at any time. You must notify your POA (agent) in writing and also alert others as well such as financial institutions, doctors, etc.
Upon the death of the Principal, a power of attorney is terminated.
The Power of Attorney is an Estate Planning Tool
The above video is by Board Certified Elder Law Attorney Timothy Crawford from Wisconsin, USA. The discussion and advice is relevant for anyone interested in obtaining a power of attorney.
Main Types of Power of Attorney With Various Purposes
As I’ve mentioned, the different types of power of attorney can be confusing. If you are unsure of what will work best for your situation, please obtain legal advice. The five types I will discuss here are the most common. Please note that there are other types that are not as common such as a power of attorney for care and custody of minor children.
1. General Power of Attorney
A general power of attorney allows the POA full legal authority to conduct business related to the Principal’s assets and financial matters, with no restraints or limited scope. Without a “durable” specification (see below), the general power of attorney is terminated if the Principal becomes incompetent or dies.
2. Durable Power of Attorney
Specific language is very important when naming a power of attorney. Any type of power of attorney can be made durable.
The durability provision allows the power of attorney to remain in effect if the Principal becomes incompetent. In other words, if you simply have a general power of attorney without making it “durable,” it is voided if you become incompetent. With the durable provision, the power of attorney continues to remain in effect allowing the POA to continue to act in the best interest of the Principal.
Very important: making a power of attorney durable allows the POA to carry out transactions whether you are incompetent or not. This means there is a possibility that the POA could do things behind your back that you are not aware of. You can, however, specify that the power of attorney does not go into effect unless you are declared mentally incompetent by a doctor.
3. Health Care Power of Attorney
The health care power of attorney names a POA to make health care decisions on behalf of the Principal if the Principal becomes mentally incompetent, unconscious or in some way incapacitated. This could include making the decision whether the Principal will receive life-sustaining procedures.
In this case, the Principal does not give up their right to discuss and make decisions regarding their own health care if they still have the capacity to do so.
4. Special or Limited Power of Attorney
A limited or special power of attorney gives the POA the power to act on behalf of the Principal in specific situations only. These situations could include just one specific transaction or several acts to be carried out by the POA.
For instance, the Principal gives the POA permission to act on their behalf for a specific period of time while they will be out of the country. Or the POA is named specifically to handle all real estate transactions for the Principal.
5. Springing Power of Attorney
If the Principal does not feel comfortable granting power of attorney to someone while they are healthy, this document does not take effect until a specified date, condition or event. The power of attorney would “spring” into effect at that time.
Some triggers that could be named to "spring" the power of attorney into effect might be a specific date or age. In addition, it could take effect only when the Principal is certified incapacitated by a doctor.
Please note that a Springing Power of Attorney may not be accepted in all states.
There are various types of power of attorney to serve your specific needs. It is recommended that everyone is proactive in obtaining a power of attorney early in life before something life-altering occurs. Best Wishes!
This is Sharyn’s Slant
Disclaimer: This article is not meant to take the place of proper legal advice. The intent is to help others understand the importance of obtaining a power of attorney for financial matters as well as health care. If you want to be sure that you have the choice of naming a power of attorney while you are of sound mind, as long as you are at least 18 years old, you should consider this now. Laws and specifications regarding a power of attorney may differ from state to state. Please be sure to obtain legal advice when completing these documents.
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