A Power of Attorney is a legal document that enables an individual (known as the principal) to select another individual or organization (known as the officer) to regulate their affairs if the individual issuing the power of attorney is unable to do so. There are various kinds of powers of attorney. All of these orders carry the same concept with them that the agent will have control over the affairs of a person, but the condition that differs is what the agent will specifically have control over.
A power of attorney is a significant component of any estate plan for several reasons, but the most common is that it helps prevent any extra costs and state intervention if the affected individual becomes mentally incompetent to handle their affairs.
Different Types of Power of Attorney
As mentioned above, when the principal becomes disabled, the different kinds of power of attorney dictate what matters the officer will take control of. Here are a few examples:
- General Power of Attorney
A general power of attorney provides wide authority to an individual or organization (known as an officer or in-fact attorney) to behave on your behalf. These powers include the handling of monetary and company operations, the purchase of life insurance, the settlement of claims, company interests, gift making, and professional assistance. General power of attorney is an efficient instrument if you are out of the nation and need someone to deal with certain issues, or if you are physically or mentally unable to manage your affairs. A general power of attorney is often included in an estate plan to ensure that economic matters are handled by somebody.
- Healthcare Power of Attorney
Healthcare power of attorney is another power or authority that focuses primarily on the medical care that a principal receives. Because of the nature of certain circumstances such as Alzheimer’s and dementia to make the afflicted unable to make rational choices, many see the healthcare power of attorney as a significant aspect of an estate plan.
The healthcare power of attorney would also become valid when the principal is made unconscious due to coma, whether medically induced or not. There are certain components of the healthcare power of attorney that can be described in advance so that in cases such as life-sustaining processes, the needs of the principal are eventually met. As long as they are able to do so under informed consent and are considered mentally competent, the principal will also stay as the first authority in healthcare matters. The power over these decisions falls on the designated agent(s) only when either of these conditions cannot be fulfilled.
- Special Power of Attorney
By signing a special power of attorney, you can indicate precisely what powers an agent can exercise. This is often used when, due to other commitments or health reasons, one can not manage certain matters. Selling property (private and real), managing real estate, debt collection, and dealing with company operations are some of the prevalent issues indicated in a special power of attorney document.
- Durable Power of Attorney
Having durable power of attorney implies that when the principal becomes mentally incapacitated, the officer will receive the powers given to him or her. Without this clarification, the power of attorney becomes null and void when the principal is considered mentally incapable of handling his or her affairs. This is essential to remember as the possibility of mental competency is often one of the primary reasons individuals create a power of attorney in the first location, but without this tiny detail a meticulously designed power of attorney can be derailed.
Contact an Attorney
If you’re planning to get a power of attorney document, it’s best to talk to competent lawyers first. Let the Law Office of Jack R. Sturgill assist you, contact us today and set up a free consultation.