Specific Powers Of Attorney

In addition to general powers of attorney, your loved one might want to look into specific power of attorney documents that grant only certain, tightly defined powers to the attorney-in-fact.

The power of attorney document can be written to give the attorney-in-fact overall powers or to grant only powers in one specific area of the principal’s life. The three most common specific power of attorney documents are:

  • Special power of attorney—gives the attorney-in-fact powers only for a named task
  • Durable power of attorney for finances—gives the attorney-in-fact power to make financial decisions for the principal if he or she becomes unable to do so
  • Durable health care power of attorney—gives the attorney-in-fact power to make health care decisions in cases of incapacitation

Special Power Of Attorney

In contrast to the broader powers given in a regular or durable power of attorney, a special power of attorney is granted to give the attorney-in-fact the power to do a specific task. The most common of these tasks includes:

  • Borrowing money
  • Collecting debts
  • Entering safety deposit boxes
  • Handling banking transactions
  • Handing government issues
  • Making estate decisions (including gifts)
  • Making financial decisions
  • Managing business interests
  • Managing real estate
  • Mortgaging real estate
  • Selling personal property
  • Selling real estate

Durable Power Of Attorney For Finances

A durable power of attorney for finances allows a principal’s loved ones to manage financial matters without going through lengthy court proceedings. Even in cases where a spouse is present to manage such affairs, the incapacity can make financial matters very difficult because spouses have limited rights when dealing with jointly owned property.

Most principals give the attorney-in-fact very broad financial powers. These often include the power to:

  • Claim inheritance or other property
  • Collect Social Security or Medicare benefits
  • File and pay taxes
  • Hire a lawyer or court representative
  • Invest in stocks, bonds, and/or mutual funds
  • Manage the principal’s business
  • Manage property
  • Manage retirement accounts
  • Oversee transactions with banks and other financial institutions
  • Pay everyday personal and family expenses
  • Purchase or sell annuities and insurance policies

Durable Health Care Power Of Attorney

Like a living will, a durable health care power of attorney is considered an “advance medical directive” because the individual is giving instructions that will be used in the future if he or she becomes incapacitated. The durable health care power of attorney allows the principal to designate an attorney-in-fact to make health-related decisions if the principal becomes incapacitated. If the principal is not incapacitated, he or she maintains the right to give medical direction on his or her own behalf.

Most states also allow the principal to request that he or she not be given “life sustaining procedures” in cases of terminal illness. Regardless of the specific requests written into a health care power of attorney, your loved one should make sure that his or her attorney-in-fact understands your loved one’s medically related preferences.

The attorney-in-fact will be able to follow the principal’s wishes to a greater extent if the power of attorney document clearly defines and specifies the powers being granted. Additionally, in cases when the attorney-in-fact is found to be less trustworthy than expected, limiting this person’s powers can save the principal a great deal of difficulty. For these reasons, it is in the best interests of the attorney-in-fact and the principal to make the document as specific as they can. The special power of attorney, durable power of attorney for finances, and durable health care power of attorney all make this possible.

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