Do I Need a Power of Attorney (POA)?

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Do I Need a Power of Attorney (POA)?

by | Sep 30, 2022 | ESTATE PLANNING, INFORMATIONAL, Search |

Yes, you need a power of attorney, commonly referred to as a POA. Unfortunately, many people don’t know they need a POA until it is too late.

This blog is taken with permission from a more thorough article at Contact or an attorney in your state for more information.

What is a Power of Attorney

A power of attorney is a document that allows someone to act on another person’s behalf. The person allowing someone to manage their affairs is known as the principal, while the person acting on their behalf is the agent. It’s important to note that POAs are generally governed by state law and there may be some differences between states. Generally, these differences are minor, but when arranging a POA, it’s important to talk to an attorney who understands the law in your state.

You also need to understand what a POA cannot do. A POA only allows someone to do the things that are agreed upon within the document. If your parent signs a POA allowing someone to act on their behalf, they can still act on their own behalf so long as they retain the capacity to do so. An agent doesn’t have the exclusive right to act and make decisions for the principal.

Additionally, agents must act as fiduciaries. This means that if you’re the power of attorney for your parent, you must manage their affairs to their benefit, not your own. The Consumer Financial Protection Bureau has advice about the legal responsibilities that agents agree to when signing a POA. You should remember that your authority as an agent is limited to what the document and the state allow.

Different types of POAs can also give the agent different powers, so it’s important to research the type of POA you need. The different types are:

General Power of Attorney

This type of POA gives the agent broad rights to manage the affairs of the principal. It lasts for a specified time, which can be noted in the document. It can also be revoked by the principal at any time and will automatically end when the principal is determined to be incapacitated. This type of POA is often used when someone can still take care of their affairs but would rather someone else do so. As these POAs end at incapacitation, they’re not a great choice for end-of-life planning or medical directives.

Durable Power of Attorney

A durable power of attorney lasts after the principal’s incapacitation. What you can do with a durable POA is based on both the document and state laws. In some cases, you may only be able to manage the principal’s finances and will need a separate medical power of attorney to make health care decisions. These POAs are used when a person can no longer handle their affairs, and it can end in several ways. They can be revoked upon the principal’s death or when a guardian is appointed. The principal can revoke the POA if they’re no longer incapacitated. For example, if a person wakes from a coma, they can take back control of their finances. There may also be conditions in the document that, if fulfilled, end the POA. A durable power of attorney comes into effect on the day it’s signed unless otherwise specified.

Springing Power of Attorney

A springing power of attorney is a type of durable POA. In this case, the terms don’t become effective until the principal is incapacitated. In most cases, this is when a doctor determines the principal can no longer manage their finances; however, the POA or state may have a different definition of when a person becomes legally incapacitated. For example, it may require certification from two doctors. This type of POA allows the principal to stay in control while they have the capacity, but it is ready to spring into action once they’re incapacitated. However, it may take time to get a certification of incapacitation, which may mean a delay in handling their affairs while waiting for paperwork.

Medical Power of Attorney

A medical power of attorney gives an agent the right to make decisions about the principal’s health care. It’s a type of durable POA that lasts until it’s revoked or the principal is determined to be competent again. It may also have an expiration date listed in the document. This type of POA is needed for people who can’t make decisions about their medical care and is common for later-life planning and making legal preparations for people with disabilities.

A medical POA is different from a living will, which states what medical procedures a principal does and does not want done. In the case of a medical POA, the agent can make all health care decisions for the principal. Because of this, your parent needs to make their wishes known to the agent before they’re incapacitated. The American Bar Association has detailed information available about medical powers of attorney and the process of giving someone that power.

Limited Power of Attorney

A limited power of attorney limits the agent to make decisions about specific tasks. It is often used to authorize someone to pay bills or sell a house, and the agent can only take action that’s specified in the document. These POAs are generally only active temporarily and will be revoked if the principal becomes incapacitated.


For more information, contact an attorney who regularly handles estate planning in your state. For information in Northern Kentucky, contact Bouldin Law Firm or call 859-581-6453 (581-MIKE) to schedule a consultation.