Not all Powers of Attorney are Created Equal

January 10, 2020

Typically, a Power of Attorney comes into play when someone is no longer able to manage their own assets. This may occur due to age, declining health or mental incapacity. When this individual was of sound mind, if he or she executed a valid Power of Attorney document, it listed someone else, a person he or she trusts, to be the Agent and grants powers to the Agent to make financial decisions and execute on those decisions.

Some Powers of Attorney are very simple and may only permit an Agent to access and manage money, accounts or property. Others vary in terms of scope and complexity. The specific language used in a Power of Attorney impacts the extent to which the Agent can maximize asset protection, sell property or allow for more complex estate planning. Some powers are required to be named very specifically in the Powers of Attorney documents in order for the Agent to be bestowed with such powers. Some of those types of powers include:

  • The power to create, amend, revoke or terminate a trust during the Principal’s lifetime.
  • The power to create or change rights of survivorship.
  • The power to create or change a beneficiary designation.
  • Make gifts (can be limited by amount and/or beneficiaries).

An experienced estate planning attorney can offer advice as to whether these expanded types of powers are appropriate for the client’s needs and objectives and what types of necessary limitations would be appropriate. To schedule a consultation on drafting Powers of Attorney, please contact Stouffer Legal at 443-470-3599 in the Greater Baltimore area.

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