A power of attorney, or POA, can be a helpful estate planning tool if used properly. Understanding what the purpose of a POA is, as well as the limitations, will be important for you and your designated agent. Following are some POA basics that can help with this discussion with your agent.
POAs are governed by state laws as are many other estate planning issues. Do not confuse a property POA with a living will, healthcare power of attorney or advanced directive. Although these estate planning tools are similar in nature to a property POA, they are created for the express purpose of giving your agent or healthcare provider the authority to make healthcare decisions for you in the event you cannot do so.
A POA can be designed to terminate upon your incapacity. If you want your agent to have authority that survives your incapacity, you must create a durable POA. Most states have very specific guidelines for what creates a durable POA. A springing POA authorizes your agent to act in your behalf only upon your incapacity. Specific language will need to be carefully included. You can grant broad powers to your agent under your POA. A qualified estate planning attorney can assist you in considering all the variations available to you before executing a POA.