No matter what type of power of attorney you need, LegalNature's intuitive questionnaire makes it easy to give your agent decision-making authority over almost all of your affairs, and our power of attorney form gives you complete flexibility in tailoring the document to your specific needs. Below, you will find a detailed description of the main sections and key components of LegalNature's customizable power of attorney in the order that they appear in the document. Note that some of these sections may be omitted from your document depending on how you answer the relevant questions.

Types of Power of Attorney

To begin, you need to determine whether you wish to complete a medical, durable, or general power of attorney. Under any power of attorney, the person creating and signing the document—the "principal"—appoints another person—the "agent" (a.k.a. the attorney-in-fact)—to manage specific matters on the principal's behalf.

• A medical power of attorney is used to appoint an agent to manage health care matters when the principal becomes incapacitated and unable to communicate.
• A durable power of attorney is the same except the agent only has authority over non-medical matters, such as financial, business, and real estate affairs.
• A general power of attorney is also used for non-medical matters; however, the agent may only act on the principal's behalf while the principal remains in good health and is able to communicate.

Below, we will discuss the different types of power of attorney in more detail. Let's begin.

Medical Power of Attorney

The following information relates specifically to a medical power of attorney. Skip below to find information regarding durable and general powers of attorney.

Naming Your Agent

The person you appoint to handle your affairs might be called an “agent,” “proxy,” “representative,” or something else depending on the state you live in. By signing this document your agent is legally obligated to follow your written instructions and to always try to act according to your known wishes. Note that our living will form includes a healthcare power of attorney within it and also allows you to specify your preferences in the event that you can no longer speak for yourself.

The agent you appoint is required to be 18 years of age or older. It is important to read your completed form thoroughly to ensure that you have met all requirements mandated by your state. For instance, some states prohibit you from naming your doctor or an employee of your healthcare provider as your representative. Most people opt to appoint a trusted friend or family member.

Successor Agents

You will need to name backup agents, called “successor agents,” in case your first choice is unable or unwilling to represent you when the time comes. For instance, your first choice may become ill, pass away, or simply no longer wish to act on your behalf.

In any case, appointing multiple successor agents is a smart way to ensure that someone you trust eventually becomes your agent. In your power of attorney, each agent and successor agent will be specifically identified by their names, addresses, and phone numbers in order to prevent any possible confusion over their identities.

Other Appointments

It is also recommended that you appoint a personal guardian. This person will be responsible for managing your personal affairs if you become incapacited. Again, appointing someone that you know and trust is crucial for preventing a court-appointed guardian being assigned to you, since such guardians will not necessarily have your best interests in mind.

Finally, you will have the option to name your preferred primary physician and any wishes you may have regarding organ donation and funeral arrangements.

Executing Your Medical Power of Attorney

Prior to signing your document, it is essential that you read it in its entirety in order to ensure that you understand it and the authorities you are delegating to your agent. Also, you will need to initial specific sections to prove that you have read and agree with them. After reviewing the form, you must sign it in front of the required number of witnesses.

Witnessing Requirements by State

Your document will instruct you as to the appropriate procedure for witnessing in your state. While some states only require two witnesses OR a notary, we recommend using two witnesses AND a notary. This will help prove the authenticity of the form should it ever be called into dispute.

Durable and General Powers of Attorney

As mentioned above, durable and general power of attorney documents both relate to non-medical matters that the agent is empowered to manage on behalf of the principal, including financial, business, and real estate affairs. The only difference between them is when the agent's powers terminate. In a general power of attorney, the agent's powers to act for the principal terminate upon the principal's death or incapacitation, while in a durable power of attorney the agent may continue to act even after these events occur. Therefore, except where indicated, the information below applies to both documents.

Recording Your Form

While your power of attorney will still be legally binding if you do not file it with your county, it is safest to do so if you are giving your agent the power to manage your real estate in case anyone contests your agent’s authority. If you select this option, your form will include recording information in the top-left corner of the first page. This information tells the clerk that files it who is requesting the filing, who created the document, and who should receive it after filing.

Naming an Agent

Here you will designate the person that you want to empower to manage your affairs on your behalf. Depending on the state, this person may be called an agent, proxy, representative, administrator, or attorney-in-fact. You will need to provide this person’s full legal name, address, and phone number in order to avoid any potential confusion as to their identity.

Consider the following questions when deciding who to appoint as your agent:

• Do you trust the person to manage the specific matters they are being appointed to handle?
• Is the person good at managing similar matters in their own life?
• Do you expect them to act responsibly as your agent and act in your best interests?
• Do they have experience handling similar financial, legal, or real estate matters?
• Can they work well and be a team player with lawyers, accountants, court officers, and others that they will encounter when acting on your behalf?
• Are they likely to accept your request for them to act as your agent?

Period of Effectiveness

Here you will indicate when the power of attorney will go into effect and the length of the agent’s authority.

For instance, you can choose to empower the agent to begin immediately or at a later date. When completing a durable power of attorney you can authorize this to occur when you become incapacitated or deceased. Here, “incapacitated” means whenever the principal is unable to comprehend and analyze his or her personal affairs in order to make competent decisions. This could result from either physical or mental impairment. Unlike a durable power of attorney, in a general power of attorney the agent’s authority normally does not continue after incapacitation or death.

You will also choose when the agent’s authority ends. This could be a specified end date or you might choose to allow the agent to continue serving indefinitely until the principal decides to revoke the authority. Again, in a durable power of attorney, the agent will normally continue serving even after the principal’s incapacitation or death.

Indicating a specific end date is often appropriate when the principal will be traveling or otherwise unable to attend to their own personal affairs for a certain amount of time. For instance, military personnel often sign over powers of attorney to a spouse or trusted friend while deployed on duty. Note that if you are unsure as to the exact time frame needed, you can always extend or revoke the authority at any time down the road. This means that your best guess should suffice.

Agent as Fiduciary

Under a power of attorney, the principal and agent are in a “fiduciary relationship.” This means that the agent is always required to act in the principal’s best interest and that their relationship is one of the highest trust and confidence. An agent who acts outside of the fiduciary relationship may end up seeing their authority revoked and possibly other legal consequences. This protection allows principals to rest easy knowing that the law will protect them if the agent abuses their authority.

Successor Agent and Second Successor Agent

Naming alternative successor agents is the best way to ensure that the principal’s wishes will be carried out, even if one of the agents ends up being unable to serve. This often happens if an agent moves out of the area, dies, or becomes ill. Other times, an agent decides that they are no longer fit to serve if they lack the expertise needed to confidently act for the principal. Your power of attorney will help you create a contingency plan should this occur.

General Authority to Act

The principal may choose to provide a blanket authority to the agent, allowing them to handle any matter on their behalf. In this case, your form will still provide an itemized list of powers. Banks, hospitals, and other organizations will sometimes only accept a power of attorney if it specifically states the power the agent is trying to exercise. If the principal does not provide total authority, you will then select from the following specific powers you wish to authorize:

• "Real property" authorizes the agent to purchase, sell, and otherwise handle the principal’s real estate matters. Real estate includes any property interest, such as homes, condos, undeveloped plots, and partial interests.
• "Tangible personal property" authorizes the agent to purchase, sell, and handle the principal’s items of physical personal property. Examples include jewelry, vehicles, furniture, art, and heirlooms.
• "Stocks and bonds" allows the agent to buy, sell, and manage stocks and bonds on the principal's behalf.
• "Commodities and options" grants the agent the authority to buy, sell, and manage commodities and options on the principal's behalf.
• "Banks and financial institutions" authorizes the agent to deal with financial institutions on the principal's behalf. This may include opening and closing bank accounts; depositing and withdrawing funds; receiving and monitoring account statements; taking out loans to support other financial, business, or legal interests; and managing debit and credit cards.
• "Operation of entity or business" grants the agent the authority to buy, sell, manage, or terminate the principal's interest in businesses they own. Examples include hiring decisions, contractual dealings, legal strategy, investment strategy, public relations, and financial decisions.
• "Insurance and annuities" allows the agent to manage any of the principal’s insurance plans or annuities, including changing or ending them.
• "Estates, trusts, and other beneficial interests" enables the agent to handle the principal’s estate planning, trusts, and other beneficial interests. A “beneficial interest” is the right to profit, distribution, property, title, or other benefits on assets held within an estate, trust, or agreement (i.e. funds from trusts, wills, guardianships, escrow accounts, etc.).
• "Claims and litigation" allows the agent to act for the principal regarding legal disputes, including settling actions, submitting claims to dispute resolution, and paying or receiving a judgment.
• "Personal and family maintenance" allows the agent to ensure that the principal’s family maintains its standard of living by providing funds for living expenses, health care, and education.
• "Benefits from governmental programs and civil or military service" allows the agent to manage government benefits, such as government loans, tax savings, and pension plans.
• "Retirement plans" allows the agent to create, maintain, and alter the principal's interest in and benefits under any retirement plans, accounts, or portfolios.
• "Taxes" allows the agent to manage the principal’s taxes at the federal, state, or local level.
• "Gifts" allows the agent to give gifts to the principal’s desired beneficiaries out of the principal’s assets. For example, this could include trusts or savings accounts for the principal’s children.

Specific Acts Authorized

Here you will find less common powers you may want to authorize. The following definitions will aid your understanding of these powers:

• "Right of survivorship" is a joint property right that allows a joint owner to receive the interest of another joint owner that passes away.
• "Beneficiaries" are any person or entity entitled to receive assets, profits, gifts, or another benefit. Beneficiaries usually receive such benefits from the principal, the principal’s estate, a trust, or an insurance policy.
• "Delegation" authorizes the agent to pass on all or part of their authorized powers to a third party.
• "Waiving the principal’s rights" means that the agent may formally give up a right that the principal has to a retirement plan, annuity, or other benefit. This sometimes happens, for instance, when the principal would have wanted a spouse or other beneficiary to receive the benefit under the circumstances.
• "Exercise fiduciary powers" allows the agent to perform any fiduciary duties that the principal may have. This might include acting as a trustee or a board member. Local state law may stipulate what fiduciary powers the agent can or cannot perform.
• "Refuse property interests" grants the agent the power to give up the principal’s property interest.
• "Inter vivos trust" means a trust created during the principal’s life with the assets (usually) to be disbursed upon the principal’s death.
• "Pets" are often addressed in a durable power of attorney. Agents may have the authority to provide support for the principal’s pets, including making boarding arrangements, paying veterinary bills, and maintaining the pets’ standard of living.
• "Funeral and burial arrangements" allows the agent under a durable power of attorney the authority to make funeral, memorial, burial, or cremation arrangements after the principal passes away. This may include buying a cemetery plot, ordering cremation, and following instructions from the advance healthcare directive and the healthcare agent or proxy, if one exists.
• "After-acquired property" is any property not specified in the principal’s will because the principal acquired it later on.
• "Gifts to agent" allows the agent to make limited monetary or property gifts from the principal's assets to themselves. This gift must not exceed the annual federal gift tax exclusion amount provided by the Internal Revenue Service (IRS). Allowing this power can help ensure that the agent can maintain their standard of living, health care, and education. It does not grant the agent complete power to use the principal's assets for whatever they want. It does allow the agent to give gifts to themselves under limited circumstances and only in accordance with the principal's expressed wishes.
• "Nominating a conservator" allows the agent under a durable power of attorney to designate a conservator for the principal if the principal does not name one themselves and protective proceedings are initiated by the court when the principal becomes incapacitated. The agent may nominate themselves to be the principal's conservator. This power is normally recommended in order to guard against the possibility of a court-appointed conservator being assigned, who will not necessarily have the principal’s best interests in mind.
• "Other matters, alter ego, incidental powers" allows the agent all rights to act on the principal's behalf as if they are the principal's alter ego. This includes all matters that are not stated within the power of attorney so long as it does not contravene the principal’s wishes.
• "Restrictions on property management powers" are provided to prevent the agent from using the principal's assets for purely selfish reasons, such as paying off the agent’s personal loan.

Special Instructions

You also have the option of including any special wishes, terms, restrictions, or instructions. It is a good idea to include any general goals here, even if they have already been communicated to the agent orally.

Nomination of a Guardian or Conservator

Under a durable power of attorney you can choose to name a guardian or conservator to help manage personal affairs. If the principal has signed a separate healthcare power of attorney, living will, advance directive, or other similar healthcare form that appoints a healthcare agent or proxy, then this section may not apply.

Amplifying Powers

This section of the form specifies the agent’s rights to compensation for their effort. For instance, the agent may be paid monthly for their services. However, the agent will be required to itemize their costs and expenses, which must be reasonable.

Here, the principal also affirms that banks and other third parties may rely on the representations made by the agent without fear of reprisal.

Finally, this section states that the agent cannot be held responsible for any unintentional or negligent wrongdoing so long as they seek to act in the principal’s best interests or according to their wishes. This is essential for encouraging agents to accept their appointments.

General Provisions

The agent is required to sign on the principal’s behalf using the following format: [Principal] by [Agent], his or her Agent. For example, if the principal is “John Smith” and the agent is “Jane Smith,” Jane will sign for John as his agent as “John Smith by Jane Smith, as his or her Agent.”

Principal’s Signature

After the principal finishes reviewing the power of attorney, they must sign in the presence of witnesses according to their state’s rules as indicated in the form.

Notice to Person Accepting the Appointment as Attorney-in-Fact

This notice is attached to the form and acknowledges that the agent understands their duties and responsibilities.The agent should carefully read the power of attorney and this notice prior to signing and accepting the nomination as agent. The agent is advised to find legal counsel if they have any questions or concerns.

Notary Acknowledgment

Although not always required in every state, it is recommended that you use a notary to witness the signing, which will help prove the authenticity of the power of attorney should it ever be disputed in court.

Statement of Witness

Here, the witnesses sign a statement affirming the principal's identity, that they signed the power of attorney in the witness’ presence, that they are of sound mind and memory, that the signature was not procured fraudulently, and that the witness or witnesses are not serving as agents (i.e. meaning that they are disinterested parties without any conflicts of interest).

Executing Your Document

The principal, witnesses, and notary should all see each other sign in person. Check your state's witnessing requirements. Since banks and other institutions often require powers of attorney to be notarized, we recommend that you use a notary even if your state does not require it. Your witnesses may not be appointed as agents in the form, related to the principal by blood, or the principal’s beneficiaries.

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Frequently Asked Questions

• What is the difference between a general power of attorney and a durable power of attorney?
• Can I revoke my power of attorney?
• Do I need to register my power of attorney?
• Are there any powers that I cannot give my agent?

What is the difference between a general power of attorney and a durable power of attorney?

In all states, a general power of attorney will cease to be effective if the principal becomes incapacitated. If the principal specifies that the power of attorney is to be durable, then the agent’s powers will continue even if the principal is incapacitated.

Can I revoke my power of attorney?

The principal is under no obligation to maintain a power of attorney and can end the power of attorney at any time and for any reason. It is always a good idea to notify your agent and any third-party institutions that you are cancelling your power of attorney.

Do I need to register my power of attorney?

There is normally no need to register a power of attorney with a specific government office. The only exception to this is that in some states a power of attorney will need to be registered with the County Clerk’s Office in order to deal with the sale or purchase of real estate.

Are there any powers that I cannot give my agent?

Yes, there are some things that an agent cannot do on your behalf. This list varies depending on what state you are in; however, common exclusions are your agent cannot vote for you or create or amend a last will and testament.

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Step 1: Communicate Your Wishes

It is usually advisable for you to communicate your wishes to anyone you plan to name as agent, guardian, or physician in your power of attorney before signing it. This will help ensure that your wishes are understood and will be better carried out.

Step 2: Review and Sign

Next, read your power of attorney thoroughly and make any alterations needed. Follow your state's witnessing requirements when signing, which will be included with the attached instructions. It is recommended that you use two witnesses and a notary when signing, even if your state allows fewer witnesses.

Step 3: Distribute Copies

Distribute hard copies and electronic copies to any person named in the power of attorney after everyone has signed.

Step 4: Periodically Review and Update

Every few years the principal should review the power of attorney to determine if any changes are needed. Major life events, such as the birth of a child or receiving new assets, may make it necessary to amend the form or create a new one. If you need to do this, simply use LegalNature's form to revoke your first power of attorney and modify your wishes.

Step 5: Revoke Your Agent's Authority (Optional)

If you do not need to amend your existing power of attorney but want to revoke your agent’s powers, simply complete a revocation of power of attorney form.

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