We make most medical, financial, and other legally binding decisions ourselves. Sometimes, we give powers of attorney to another individual so they can make medical or financial decisions on our behalf.
But what if we’re physically or mentally unable to make important decisions because of a medical emergency or another circumstance? In such cases, a durable power of attorney document can provide direction and guidance in a crisis, as well as ensure that your desires are adhered to.
In this article, we’ll explain what a durable power of attorney is, how it works, and when you might need one.
What is a Power of Attorney?
A power of attorney is a legal document or authorization that designates one person to act with legal authority for another person. A power of attorney provides the agent, also known as the attorney-in-fact, the right to make legally binding decisions on behalf of the other party, known as the principal.
Normal powers of attorney come in two types:
- General powers of attorney cover a wide variety of decisions or transactions.
- Limited powers of attorney only allow the attorney-in-fact to make decisions for the principal in very limited cases.
Generally, powers of attorney are used for financial or healthcare decisions. For example, an elderly person may designate their child as their attorney-in-fact and give them financial powers of attorney. In this case, their child can handle their finances and make decisions regarding retirement income, investments, etc.
What is a Durable Power of Attorney?
In most cases, ordinary powers of attorney expire or are no longer relevant if the principal becomes incapacitated or mentally incompetent. For example, if a principal is no longer healthy or falls into a coma, any general powers of attorney they may have authorized cease to be legally relevant.
Durable powers of attorney are more robust and remain in effect even when the principal becomes unable to make decisions for themselves. A durable power of attorney document authorizes the attorney-in-fact to make legally binding decisions for the principal, even if said principal is incapacitated in some way.
A durable power of attorney can take effect immediately, or it can be written to only take effect if or when the principal is incapacitated. With a durable power of attorney, the attorney-in-fact can handle transactions or decisions including but not limited to:
- Filing tax returns
- Buying and selling property like real estate
- Applying for financial benefits from the government
- Managing bank accounts
- Paying bills
- Making investments
Durable Healthcare Power of Attorney
To make medical decisions, an attorney-in-fact must be authorized by a durable healthcare power of attorney. This document can be useful if an accident or other medical emergency leaves the principal unconscious or otherwise incapacitated to make choices about their healthcare.
Under the terms of a durable healthcare power of attorney, the attorney-in-fact can make decisions such as:
- Whether to admit or discharge the principal to or from a nursing home, hospital, or other healthcare facility
- Who, if anyone, may gain access to the principal’s medical records
- The treatments or medicines administered to the principal
The attorney-in-fact can only make these decisions if the principal is incapacitated or otherwise unable to make those decisions for themselves.
A durable healthcare power of attorney is not the same thing as a living will or advanced directive. Such documents explain what treatment the principal wants if they are not able to make decisions or cannot communicate their desires near the end of their life.
Does the Attorney-in-Fact Have Complete Power?
With a durable power of attorney, the attorney-in-fact must make decisions according to what they genuinely believe to be the best interests of the principal or what they believe the principal’s wishes might be. These wishes or terms may be stipulated in the durable power of attorney document prior to the principal’s incapacitation.
The attorney-in-fact doesn’t have complete power—in most cases, they serve as a conscious, responsible individual to sign documents or to authorize actions on behalf of their principals. However, attorneys-in-fact are sometimes required to make important life-or-death decisions, so you should only give durable powers of attorney to someone you trust.
How to Obtain or Remove a Durable Power of Attorney
You can find durable power of attorney forms online or from other legal document resources. However, you should always talk to an experienced estate planning attorney before making any decisions or drawing up any documents. The right Arkansas power of attorney lawyer can overview your document to make sure it does not include any problematic loopholes, only covers the circumstances you want, and applies to the correct individual or attorney-in-fact.
As long as you are not incapacitated and are mentally competent, you can revoke a durable power of attorney at any point. However, it’s best to do so in writing and with the assistance of knowledgeable lawyers who can deliver the document to the right institutions or individuals on your behalf.
Contact Milligan Law Offices for an Initial Consultation
If you’re not sure whether you need a power of attorney or a durable power of attorney, the experienced legal team at Milligan Law Offices can help. We are ready to help you draw up documents, discuss powers of attorney, and more. Contact us today by calling (479) 783-2213 or by requesting an initial consultation here.