A durable power of attorney is an essential legal document that should be completed during the estate planning process. This document gives a designated agent the authority to make financial and medical decisions on your behalf in the event of your incapacitation. The most significant benefit of a durable power of attorney is that it allows your agent to act without having to obtain a guardianship or conservatorship from the court.
While a durable power of attorney can’t prevent accidents, illnesses, or old age, it can protect your interests during difficult times. Keep reading for the essential information you need to know about this legal document.
Whom Should I Name as My Agent?
You can choose any individual you trust to serve as your agent. You may consider your spouse, sibling, adult child, or close friend. There are even professional fiduciaries available to fill this role.
Keep in mind that you should discuss your decision with the person you want to name. It is important to make sure that he or she is willing to accept the appointment.
When Will My Durable Power of Attorney Take Effect?
A financial or property power of attorney can become effective upon signing or it can be springing, meaning it will come into effect upon your incapacity. When you create a medical durable power of attorney, it is with the knowledge that your agent will not have any authority until you become incapacitated. While it is unpleasant to think about, potential scenarios include falling into a coma or suffering from age-related cognitive decline, and it is important to have such documents in place.
You are considered incapacitated in the eyes of the law once you are unable to make or communicate financial and/or medical treatment decisions. Typically, a licensed physician is responsible for determining an individual’s capacity.
In some cases, a durable power of attorney will never go into effect. For example, you may choose to revoke it. As the principal (the person initiating the action), you have the ability to revoke a durable power of attorney at any time as long as you are of sound mind. Other scenarios, such as your death, can terminate the power of attorney.
What Responsibilities Will My Agent Have?
Your agent is a fiduciary, meaning he or she is legally obligated to act in your best interest. Specifically, he or she is required to operate within the scope of authority granted in the power of attorney. For that reason, it is important that your document explicitly states what you want your agent to do or not do.
Additionally, if you want to grant certain powers, commonly known as “hot powers,” you must explicitly list them in your document. These powers include making a gift or creating, amending, revoking, or terminating a trust. Our attorneys can discuss these considerations in detail.
How Do I Create a Durable Power of Attorney?
In Colorado, it is possible to prepare a durable power of attorney form on your own by using statutory forms. Keep in mind that they will contain limited powers. Some states also have additional requirements for a durable power of attorney to be legally valid.
When preparing this document, it is crucial to ensure that your wishes are clearly expressed and that you have covered all your bases. This includes deciding if and how your agent should be compensated for his or her efforts.
Due to the importance of the document and the complexities involved, many people choose to contact an experienced estate planning attorney for help writing and preparing a durable power of attorney. At LSTT, our award-winning legal team can help you create this vital document and ensure that it is legally valid. It is ideal to complete this paperwork as part of your comprehensive estate plan to guarantee that every aspect of your plan works well together.
Contact Our Colorado Springs Attorneys
To learn how LSTT can help with your durable power of attorney matter, please call us at (719) 689-8767. We proudly serve the Colorado Springs, Pueblo, and Castle Rock areas of Colorado.