Durable Power of Attorney Form

A Durable Power of Attorney (DPOA) is a document that allows someone you choose (an “agent” or “attorney-in-fact”) to make certain decisions for you or act on your behalf, even if you become incapacitated.

A durable POA remains valid until your death or until you actively revoke it. The critical attribute of this document is that it remains “durable” (enforceable) even if you become mentally or physically incapacitated.

This allows your appointed agent to act on your behalf during those challenging times and will care for your personal and financial affairs or make healthcare decisions if you cannot manage them yourself.

Durable Power of Attorney – By State

Table of Contents

• Durable Power of Attorney - By State
• Durable Power of Attorney - By Type
• What is a Durable Power of Attorney (DPOA)?
• How to Get a Durable Power of Attorney
  • Signing Requirements
• How To Write a Durable Power of Attorney
• Advantages and Disadvantages
• Frequently Asked Questions

Durable Power of Attorney – By Type

What is a Durable Power of Attorney (DPOA)?

A durable power of attorney is a document you can create, giving another individual the power to act in your place and manage your financial, business, legal, or medical affairs if you cannot do so.

With this document, the person granting or giving the power is called the “principal.” The person receiving the power to act is called the “attorney-in-fact” or “agent.”

It is adequate when you choose when it’s signed or upon your incapacitation. Most significantly, it remains in effect even if you are incapacitated.

The power ends when you pass away or revoke or under the circumstances outlined in the document.

Definition of “Durable”

The term “durable” is defined in Section 102(2) of the UPOAA as:

“Durable,” with respect to a power of attorney, means not terminated by the principal’s incapacity.

One key element of the UPOAA is the default rule regarding durability. Under Section 104 of the UPOAA, a power of attorney is “durable unless it expressly provides that it is terminated by the incapacity of the principal.” That means a power of attorney will be effective beyond the principal’s incapacity.

Tax Implications

It can be used for tax purposes to appoint someone to act on your behalf if you become incompetent or unable to act.

To authorize your DPOA to represent you in front of the IRS and take care of your taxes, you’ll need to fill out IRS Form 2848. This form includes important information such as your Social Security number, the name and mailing address of your representative(s), and a description of the matter(s) for which they are authorized to represent you. [1]

Durable Power of Attorney vs. General Power of Attorney

The difference between a Durable Power of Attorney and a Power of Attorney is that the former remains in effect even if you become incapacitated, while the latter does not.

• A durable power of attorney allows your agent to decide on your behalf even if you become incapacitated. For example, your agent can continue (or start) acting on your behalf if you’re diagnosed with dementia.
• A general power of attorney (non-durable) is no longer adequate if you become mentally incapacitated. For instance, if you have dementia, your agent will lose decision-making power.

The main difference is that DPOA remains effective even if you become mentally incompetent.

At the same time, the latter is only valid if you’re mentally competent.

This means that if you have a standard (non-durable) power of attorney and your mental capacity declines to a point where you are deemed mentally incompetent, a power of attorney expires. Your agent can no longer make decisions for you.

A durable power of attorney is your best bet if you need someone to make decisions for you in the long run.

But if you need someone to sign documents on your behalf for a specific transaction because you don’t want to or cannot appear in person, a non-durable power of attorney is more advisable.

What Rights Does a Durable Power of Attorney Have?

The rights your attorney-in-fact has under a durable power of attorney can vary, depending on your goals.

• Manage finances – You can give the attorney-in-fact the power to manage your finances, including your bank accounts, investments, real estate, and other property.
• Make medical decisions – You can also give the attorney-in-fact the power to manage your medical decisions. Finally, you can provide the attorney-in-fact power to control both aspects.
• Broad or limited powers –You can also give the attorney-in-fact broad or limited capabilities by restricting certain powers.

How to Get a Durable Power of Attorney

Here is everything you need to know:

Step 1 – Designate Your Agent(s)

Your agent can be a trusted family member, a close friend, or an attorney—basically, anyone you know and trust who will be responsible and act in your best interest.

They will have access to your financial information and can make medical decisions on your behalf.

You can name one or more individuals as agents, which can cause delays if the two agents must collaborate but cannot reach a consensus.

It’s also a good idea to designate successor or backup agents if the primary agent cannot act.

Step 2 – Choose What You Authorize Your Agent to Do

Determine and list the areas where you want to give your agent authority.

For the medical power of attorney, you might also want to think about what’s in your best interests, the treatment or medical care you wish to receive, and the medical records you want to share with your agent.

Step 3 – Draft Your Power of Attorney Form

Once you’ve chosen your agent, considering what they are authorized to do and how you will draft your documetn, it’s time to complete the form accordingly.

If you plan to use generic forms with prewritten clauses, ensure you agree with them before you sign your document.

Consider when you want the document to become effective.

The DPOA often becomes effective once the principal signs the document. Still, you can also decide if you want the document to become effective later or upon your mental incapacitation.

Remember to include language that clearly states your intentions that a power of attorney survives your mental incapacitation.

Step 4 – Check Signature and Notary Requirements in Your State

Make sure the form complies with your state’s laws.

Most states require durable power of attorney forms to be signed before a licensed notary public, and some need two witnesses to make it legally binding.

Step 5 – Keep a Copy of the Power of Attorney

It must not be filed with a court or government office to be valid.

However, you must keep a copy of the document with your other estate planning documents and give another copy to your agent or agents.

It’s also a good idea to share with stakeholders like your bank or doctor’s office.

Step 6 – Update the Document As Needed

If your needs and situation change, ensure they are reflected in a power of attorney. It is difficult to override a durable power of attorney after you’ve become incapacitated and will require court proceedings.

Signing Requirements

Some states have special requirements for notarizing a document granting durable power of attorney. It’s always advisable to follow your state’s rules when asked to notarize a signature on a document. You can find state signing requirements for all types of POA here.

How To Write a Durable Power of Attorney

A durable power of attorney grants power to the designated agent or attorney-in-fact that continues regardless of the principal’s mental condition unless otherwise stated. Due to the level of authority granted in a durable POA, clarity is crucial. Follow these steps to write a detailed durable POA and avoid legal complications that could harm your financial health.

This is generally the structure of a durable power of attorney; however, the structure and necessary provisions vary from state to state. 

Step 1 – Designation of Agent

Indicate who you would like to designate as your attorney-in-fact. Enter their full legal name and physical address, as well as the name and address of any co-agents. Although the form only allows space for two designated agents, you can add others in the Special Instructions section.

An agent should be a trusted individual capable of handling your financial matters responsibly. Individuals you may choose to designate as an agent include:

• A reputable professional
• Your spouse
• A close family member or relative
• A close friend

Discuss the matter with your agent before beginning the POA process. They should be willing and able to handle tasks in accordance with your wishes. Consider whether they have the time and capacity to take on these financial matters in your absence.

Since you cannot plan for every contingency, include a successor agent to take over should your designated agent be unable to handle the POA tasks. You may also enter a secondary successor agent if your successor agent cannot meet POA terms.

Step 2 – Grant of General Authority

Choose which powers you want your attorney-in-fact to have. A durable POA will continue beyond the point where you become incapacitated and typically has no end date unless you specify one.

Some principals afford only strictly necessary authority to their agent of choice. Others may grant full authority over all financial matters a durable POA covers.

Initial the line before the subjects you wish to include in your agent’s general authority under the durable power of attorney.

If you want your agent to handle all the above financial matters, initial line N for “all preceding subjects.”

Step 3 – Grant of Specific Authority (Optional)

When you grant general authority to your agent, certain activities are automatically excluded from their powers unless you specifically request them. These powers are protected because they can give your agent the ability to reduce your property or alter property distribution upon your death.

Initial the line next to the specific authority you want to grant your agent under the durable POA. If you are unsure whether a particular power is necessary, consult an estate or probate attorney before signing the authority over to your agent.

Step 4 – Special Instructions (Optional)

Under the special instructions section, list any additional information pertinent to your durable power of attorney. This is where you can include the names of additional attorneys-in-fact or successors.

Use this section to detail further limitations or instructions for handling your affairs. For example, you may choose a specific agent to handle certain matters. You may also use this to limit further or control the powers granted by the durable power of attorney.

Step 5 – Effective Date

You have three options when establishing the effective date for a durable power of attorney:

• Immediately effective: The durable POA becomes effective once the form is fully signed and notarized, consistent with state laws.
• Effective on a specific date: The agent becomes responsible for power of attorney on a specific date. This is often used for military deployments or incarceration when a start date is known.
• Effective upon a specific event or contingency: Power of attorney transfers to the designated agent when a specific condition is met. For instance, the agent may become the attorney-in-fact if the principal becomes incapacitated due to an illness or injury.

Contingency-dependent effective dates often arise in estate planning. The principal creates a power of attorney form in case they become unable to manage their own affairs. If the principal never becomes incapacitated, the durable POA may never go into effect.

Step 6 – Termination

A durable power of attorney endures regardless of the principal’s disability or incapacity. Unless otherwise noted, it does not end after a specific period of time. Other types of POAs, called Limited Powers of Attorney, may only be effective for as long as it takes to handle a particular matter.

For instance, the principal may temporarily grant power of attorney to a family who helps them sell their house. Once the house sale is complete, the power of attorney expires.

A durable power of attorney, on the other hand, continues indefinitely until the principal revokes it or passes away. Upon the principal’s death, financial responsibilities become the responsibility of the estate’s legal executor.

Step 7 – Nomination of Guardian (Recommended)

If you become incapacitated, the court may choose a guardian to handle your personal affairs. Such affairs may include healthcare, legal, and financial decisions.

Unlike a power of attorney, guardianship does not have limitations on authority. They make all decisions on behalf of the principal. Guardianship is typically reserved for a severe mental disability that makes the principal incapable of making their own choices.

If the court appoints a guardian while a durable power of attorney exists, the agent and guardian may work together to handle the incapacitated principal’s affairs.

You can nominate a separate guardian for your estate and your person on your durable power of attorney form or appoint one person to serve in both capacities. However, the final decision to appoint the guardian(s) rests with the probate court. When nominating a guardian, choose someone you trust to care for you and act in your best interests.

Step 8 – Reliance On This Power of Attorney

Include a clause that formally addresses the scope and intent of the power of attorney. This section should indicate that anyone, including the agent, can rely on the validity of the POA form unless they know it is invalid.

Step 9 – Signature and Acknowledgment

A durable power of attorney requires a signature and acknowledgment from the principal. If you cannot physically sign the form, a representative can sign the form on your behalf. When signing on your behalf, they should enter the following details in the signature and acknowledgment section:

• Name of the representative
• Signature of the representative
• Signing on behalf of
• Printed name of the principal
• Principal’s address
• Principal’s telephone number

Your power of attorney form may require a notary or witnesses to be valid. Review your state’s signing requirements before you or your representative sign the form to ensure you follow appropriate legal protocols. Failure to do so could invalidate the durable POA entirely.

Step 10 – Notary Public

The notary may ask for a driver’s license, state ID, or other form of photo identification to verify your identity. They may complete a notary acknowledgment at the bottom of the durable POA form or complete a separate state-approved form. The acknowledgment typically includes the following details:

• State or commonwealth name
• County name
• Date of notary acknowledgment
• Notary signature
• Notary seal
• Date the notary’s commission expires

Advantages and Disadvantages

Advantages

1. Continuity: Remains in effect even if you become incapacitated. This means that your agent can continue to manage your affairs on your behalf without the need for court involvement.
2. Clear designation of powers: Helps prevent disputes between family members regarding the management of your affairs. By clearly designating an agent and outlining their powers, everyone involved will know who is responsible and what they are authorized to do.
3. Convenience: Avoid the need for a court-appointed guardian or conservator. This can save time, money, and emotional stress for both you and your loved ones.
4. Tailored to your needs: DPOAs can be customized to meet your specific needs. For example, you can grant limited powers for specific purposes or provide broad authority for various decisions.
5. Privacy and control: DPOAs allow you to maintain a level of privacy regarding your personal and financial affairs. You can choose who has access to your information and who will be responsible for managing it.

Disadvantages

1. Difficulty revoking: Once you sign the document, it can be difficult to revoke or modify it. This can be a disadvantage if you change your mind about who you want to act as your agent or if you feel that your agent is not acting in your best interests.
2. Potential for abuse: Granting someone else the authority to make decisions on your behalf opens the possibility of abuse. The appointed agent may act against your best interests or make decisions that you wouldn’t approve of.
3. Lack of oversight: Once you’ve granted power of attorney, there may be limited oversight. Unless someone challenges the agent’s decisions, they may have significant control without regular checks and balances.
4. Financial risk: Granting someone the authority to handle your financial affairs could potentially expose you to financial risk if the agent mismanages your assets or engages in unethical behavior.
5. Dependence on the agent: If you become reliant on your agent for decision-making, you might lose some independence. It’s important to strike a balance and ensure that your wishes are still considered and respected.

Frequently Asked Questions