A Power of Attorney is unique in your overall estate planning strategy because it allows for decisions to be made on your behalf at key points in your life, especially if you were to become incapacitated due to a car accident or illness. To ensure everything is handled appropriately, you need to name someone who can step in during these critical life moments. This person is known as an attorney-in-fact.
While “attorney-in-fact” sounds like it requires someone with legal experience, the reality is that you can choose whomever you want — a friend, family member, etc. But that doesn’t change the fact that it’s a big decision for you and a fiduciary responsibility for them.
What does an attorney-in-fact do?
The instrument that appoints an Attorney-In-Fact is referred to as a Power of Attorney (POA). An attorney-in-fact or agent handles specific affairs on your behalf when you cannot. A few examples include the following:
- Signing checks
- Paying bills
- Filing and paying taxes
- Operating a business
- Hiring someone to represent you in court
- Making informed decisions regarding healthcare
- Certain end-of-life decisions
These powers and many others are limited to a list you create in your POA, and they can be as narrow or broad as you want in terms of the authority you assign. The decision is yours.
Are there drawbacks to naming an attorney-in-fact?
There are drawbacks to everything. Risk is the most obvious in this case. You want to make sure that you trust the person you appoint as your attorney-in-fact or agent and that you revoke that power if that relationship changes. As a result, having a qualified estate planning attorney draft your Power of Attorney is the best course of action if you ever need one.
Not only will they help you properly define the scope of authority for your attorney-in-fact, duration of power, and other important matters, but they can advise you on additional legal instruments that will cover you and your family for years to come.
Please call Christman Attorneys, PLLC, for your legal needs today!
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