Durable powers of attorneys are very important documents and are often prepared as part of an estate plan. There are generally two different types of durable powers of attorney: (1) for health care; and (2) for finances. These documents provide help in caring for a person’s health and finances when that person is no longer able to make decisions and care for one’s self. Most people focus the planning for the distribution of their assets on death rather than in the event of long-term incapacity. However, as you may have already observed, long-term incapacity can be even more devastating than death to the family, both emotionally and financially. Preparation of durable powers of attorney can help.
The durable power of attorney for health care identifies who would make medical decisions on your behalf if you are someday unable to do so yourself. It can provide for alternate or secondary individuals as well. In addition to stating whom you want to make the medical decisions on your behalf, the document can also expressly state any desires you have as to specific medical treatments. For example, desires can be expressed in the document about experimental medications or whether life-sustaining medications are given if there has been significant brain damage or other injuries. This document gives treating doctors the authority to listen to your designated representative otherwise known as an “agent” or “attorney in fact”. Another important aspect is that the document can state the conditions under which the appointment becomes effective.
The other durable power is for managing the finances of a person who has become incapacitated. It is important to understand that even when a person becomes incapacitated, bills may still need to be paid and finances still need to be managed. For example, just because a person ends up under long-term hospital care, that person’s mortgage will still need to be paid or his/her house could fall into foreclosure. The durable power of attorney for finances gives your agent or attorney-in-fact the ability to manage your financial affairs for your benefit. You can limit the authority granted in the document to particular acts, like selling your house. Alternatively, it can be broader in scope, allowing your agent to sign checks, pay bills, and deal with the IRS. The durable power of attorney can be of a limited time if desired and it can limit or direct powers.
If you have further questions about durable powers of attorney, contact Daniel Geraldi at (925) 236-0045.