The ‘power of attorney’ is a legal instrument that grants a third party the power to transact businesses on behalf of yourself. The person granting the power is called the principal whereas the one receiving the same is the attorney-in-fact.
What is the “Power of Attorney Form”?
This is the form that is filled out to grant the stated powers from one party to another. The form is issued by the state, is duly filled out, and thereafter notarized. It basically contains the fields which spell out the exact powers to transfer to a third party.
Types of “POA forms”
- Durable (Financial) Power of Attorney – Handles financial aspects of the powers thereof. The form is mainly used when the principal is incapacitated and is hence unable to transact any businesses on his own.
- General (Financial) Power of Attorney – Used for much the same reasons above. It, however, comes in when the principal is still of sound mind but ceases to apply in the event of incapacitation or death.
- IRS Power of Attorney (Form 2848) – Authorizes individuals to represent you before Internal Revenue Service. This individual has to be eligible to practice before the tax collection agency.
- Limited Power of Attorney – Gives a portfolio manager to carry out specific tasks on your behalf and in your account. The form specifies the exact areas that the portfolio manager has a right to come in.
- Medical (Health Care) Power of Attorney – Allows individuals to empower others with decisions that touch on healthcare and treatment strategies.
- Minor Child Power of Attorney – Grants the parents the leeway to delegate to another grown-up the authority to make sound decisions on behalf of his child without necessarily relinquishing the custodial or parental rights.
- Real Estate Power of Attorney – Enables you to authorize another person to buy or sell real estate property on your behalf or carry out any other businesses that revolve around the field of real estate.
- Revocation of Power of Attorney – Cancels a previous appointment which you had made or committed to. It goes ahead to terminate and nix the rights of the agents involved in the process.
- State Tax Filing Power of Attorney – As the designation implies, this form allows a third party to file your taxes but not handle your medical care bills, personal finances and other pieces of property.
- Vehicle Power of Attorney – Basically grants the owner of an automobile the powers to delegate the responsibilities to handle quite a number of tasks that revolve around the motor vehicle such as obtaining the certificate or title, registration, and sales.
How to get a Power of Attorney?
There is no unified way of obtaining this power. The requirements vary greatly from state to state. You hence have to familiarize yourself with the laws that govern the acquisition of this form in your state.
Step I: Obtain the forms
Generally, though, you will have to download the form from the website of the relevant state. Alternatively, you will have to pay a visit to the local state office and request the same from the office.
Step II: Choose an agent
An agent is the one who transacts business on your behalf. This is a person who is not only known to you but is also trustworthy. You have the leeway to choose whomever you deem qualified as there are no restrictions here.
Step III: Fill the forms
Go ahead to fill the forms. Many states require that you fill three or four copies. These are to be retained by you, your attorney, the state, and one witness. After you are done with filling, you have to append your signature to make it official. You may choose to hire an attorney to review it and determine whether it meets the legal thresholds.
Step IV: Notarize the form
As the last step, you have to notarize the form. This basically entails taking the form to a notary public to be certified as being genuine. It is only after this that the form becomes recognized by the state.
How to sign a POA?
We have already indicated above that the form has to be signed by the witnesses and you to make it official. The agents and the principal have to both sign it. Some states further require that the witnesses, notary public, and two non-family members sign it too!
In the course of singing the document, you first have to enter the name of the principal on whose behalf you are to act, following this by your name. Designate your name as the ‘attorney-in-fact.’
Free POA Forms (by State)
Free Power of Attorney Form
Frequently Asked Questions (FAQs)
Power of Attorney vs Durable Power of Attorney
A ‘general power of attorney’ otherwise simply called ‘power of attorney’ applies when the principal is alive and of sound mind. The ‘durable power of attorney’ on the other hand applies when the principal is incapacitated and is hence unable to act on his own. Beyond that, they both serve the same purposes.
When to use POA?
This power is most useful when you are squeezed to the extent that you cannot work on your own. Its durable variant also comes in when you are incapacitated and cannot hence handle your issues on your own. For instance, you might have a chronic illness which renders you unable to run your errands on your own. In this instance, you will have to bring in someone to help you out.
How to change/remove the power of attorney?
Step I: Draft a revoking statement
Express the intent to revoke the ‘power of attorney.’ This should be in writing and has to be drafted on a standard revocation online form. In the statement, include your own name, date, expression of sound mind, and a desire to revoke the power of attorney you had earlier issued.
Step II: Prepare a witness certificate
Prepare a witness certificate if you wish to revoke a ‘durable power of attorney.’ The purpose of this witness certificate is to prove that you are mentally competent to nix this power.
Step III: Sign the revocation letter
You now have to sign this revocation letter. Other than you, some two witnesses must also sign the same. These witnesses are persons who are familiar with but not related to you. They should also be ineligible to inherit your estate upon your demise.
Step IV: Name the new agent
At this stage, you have to reveal and name your new agent.
Step V: Make copies of the revocation letter
Lastly, produce several copies of this revocation letter. Furnish your former agent with a copy of the same too! Needless to say, you have to furnish every other party with his own copy also.