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How Can a Non-Durable Power of Attorney Allow You to Temporarily Delegate Authority to Another Party?
You may diligently handle your finances on your own or enlist the assistance of a financial planner to help you make the best possible decisions with your assets. But sometimes, you may need more help to complete certain financial transactions. For example, imagine if you required an agent in another location to sign a legal document for you or if you needed to authorize someone to pay your bills at home while you were traveling in another country.
A helpful lawyer from Davidov Law Group can explain how drafting a non-durable power of attorney could prove useful if you find yourself in a situation where you need to transfer the ability to handle some or all aspects of your finances to another party. A New York powers of attorney lawyer can also outline the limitations and state requirements for these powerful documents to ensure you are utilizing them safely for your maximum benefit. Don’t hesitate to contact our firm today for more information and guidance.
What Does a Power of Attorney Do?
A power of attorney (POA) is a legal document that allows a designated person or persons to act on your behalf in financial and property matters. To be legal, the POA must meet the standards outlined in New York state law. Additionally, if you wish your POA to remain valid for an extended time, you should perform regular checks and updates with the assistance of a skilled attorney. Frequent maintenance ensures that your POA is current with all applicable laws and the agent you have designated is still capable of taking on the significant responsibility of the position.
One key point to note is that a New York POA does not grant the agent the ability to make health care or medical decisions for you. To ensure your medical care is properly handled when you cannot make your wishes known, your estate plan should contain a health care proxy. An estate planning lawyer can help you determine which documents are required to meet your needs.
What is the Difference Between a Durable and Non-Durable Power of Attorney?
Both varieties of POA may grant your agent sweeping powers to take care of all your financial issues or can be tailored to handle a specific circumstance. The main difference between the two types of POAs lies in when the powers are revoked. By understanding the options available to you, you can make an informed decision on which POA is best suited to your goals.
Non-Durable Power of Attorney
A non-durable POA is usually drafted to serve a specific, time-limited purpose. The powers granted by the POA remain until the principal (the creator of the POA) revokes them or the transaction(s) defined by the POA are completed. However, this type of POA also immediately ceases if the principal dies or becomes incapacitated for any reason.
Durable Power of Attorney
The terms of a durable POA are still legally valid if you lose your capacity to make decisions on your own due to injury, illness, or advanced age. You can use a durable POA to ensure that a trusted person manages your finances if you become unable to do so. Your agent can pay bills, make gifts, and contend with business affairs and other financial transactions on your behalf.
By creating a durable POA, you prevent your loved ones from having to go to surrogate’s court to get a Guardian of Property assigned to oversee these tasks during your incapacitation. However, a durable POA does expire upon the principal’s death.
What is a Springing Power of Attorney?
A springing power of attorney can be durable or non-durable, depending on how it is structured. This type of POA is designed to “spring” into effect when a predetermined situation arises. For example, you could draft a durable POA to become effective only after you are declared incapacitated by a doctor. A springing POA can prevent your agent from accessing your finances until their assistance is needed, limiting the potential for fraud or misuse of power. It is crucial to enlist the help of an experienced attorney to draft a springing POA because they can be complex, and any errors can result in the document not performing as you wish at a critical time.
When May a Non-Durable Power of Attorney Be Appropriate?
Since a non-durable POA ceases if you become incapacitated or pass away, it is not useful as an estate planning tool. However, a non-durable POA can play a role in your general financial plan or be appropriate for certain short-term circumstances where you wish to allow an agent to act on your behalf in a financial transaction.
Situations where you may choose to draft a non-durable POA include, but are not limited to:
- Allowing an investment broker to make financial decisions for you regarding the purchase or sale of stocks.
- Appointing an individual to handle your finances while you are out of the country for military duty, business, or long-term vacation.
- Giving a trusted person the legal power to sign official documents if you cannot be physically present.
How Can an Experienced Lawyer Help You?
While it is possible to draft a non-durable power of attorney on your own, you may be opening yourself to substantial financial risks. The document must be precisely worded to ensure the agent’s powers are strictly limited to the circumstances where you require their assistance. Otherwise, their powers may not terminate when you want them to, and the agent may be able to take further actions you did not approve, such as spending your money, selling or mortgaging your property, or making important decisions regarding your business.
Davidov Law Group can help you evaluate your needs and explore which powers of attorney are suitable for your circumstances. We will ensure your documents are carefully drafted to meet state laws and protect your interests. Contact our law firm today at 516-253-1366 to schedule a free case evaluation and learn how we can serve you.
