In a power of attorney, an individual is authorized to act on behalf of another individual. Agents are sometimes referred to as attorneys-in-fact and are given the authority to act.
A principal is an individual on whose behalf the agent acts. An attorney-in-fact doesn’t need to be an actual lawyer.
Powers of attorney must be in writing. Powers of attorney authorize an agent to act on behalf of the principal or grantor.
Power of attorney agents may exercise all rights and powers granted to them. An agent, however, may not act beyond the scope of a power of attorney.
A power of attorney must generally be signed and dated by the principal. A principal can only authorize a power of attorney with sufficient mental capacity.
Creating a valid power of attorney may also require the following elements:
A power of attorney should include several important elements, including:
In some cases, it is possible to modify a power of attorney document in the future. Moreover, some power of attorney forms include a clause that outlines what to do if there is a dispute.
To resolve a dispute, the parties may agree to file a lawsuit. Other times, the parties may decide to resolve disputes through alternate dispute resolution.
The duration of a power of attorney depends upon whether it is a durable power of attorney or a non-durable power of attorney. Non-durable powers of attorney are revoked either by the grantor’s death or when they become incapacitated.
Generally, a non-durable power of attorney remains valid until the agent receives notice of death or disability. Durable powers of attorney, on the other hand, last beyond the grantor’s incapacity.
There are two types of durable powers of attorney, general and limited. A durable power of attorney will contain specific language to that effect; for example, “a power of attorney shall not be affected by subsequent disability or incompetence.”
Durable powers of attorney are limited in one significant way: they expire upon the principal’s death.
There are two types of powers of attorney: general and specific powers of attorney. A power of attorney gives the agent all of the principal’s powers and rights.
For example, a general power of attorney may authorize the agent to do the following:
Regardless of whether the principal is incapacitated, a general power of attorney may be used. Death or incapacitation of the grantor terminates general powers of attorney unless the grantor revokes them earlier.
Powers of attorney allow the agent to make decisions about specific issues, such as property transactions. In this case, a power of attorney is known as a limited or specific power of attorney. For a single, specific transaction, it authorizes the agent to act on behalf of the principal.
By granting an agent power of attorney, you authorize the agent to act on your own behalf concerning certain life decisions. The basic requirements for granting a power of attorney in Ohio are listed below, along with some tips for filling out your agreement.
Obtaining the Paperwork
The process of obtaining a boilerplate power of attorney form is quite straightforward. You can purchase the documents in most office supply stores, and many of the forms will already contain the language required by Ohio law.
If you have already retained an estate-planning lawyer, they can provide you with the forms or draft them to suit your needs more closely.
Appoint a Trusted Agent
Your “attorney-in-fact” can carry out any duties outlined in your agreement as an agent.
Typical power of attorney grants includes:
As a result, you should appoint a family member or close friend as your agent to ensure they are acting in your best interests.
Discuss Your Agreement
It would be best if you discussed the specifics of your agreement with your agent after you have chosen one.
The first step is to determine when the terms of your agreement begin and end. To protect yourself from a future abuse of power, you must set the expiration dates per Ohio law.
Make sure your agent is aware of their powers and that they are comfortable making these often-difficult decisions for you.
Sign the Agreement
After you have discussed your agreement with your agent, both of you must sign it. Notarizing your power of attorney agreement is required by Ohio law. Banks usually offer notary public services for free or for a small fee.
One common scenario when a durable power of attorney is used is a healthcare proxy. The principal appoints an agent to make healthcare decisions on their behalf with a healthcare proxy.
A healthcare proxy does not take effect until the grantor becomes incapacitated. Despite the grantor’s incapacity, the proxy remains in effect. The healthcare proxy must be in writing and signed by the grantor to be valid.
There must be a provision in the proxy statement that the grantor executed the healthcare proxy free of duress. Another purpose for which a power of attorney is frequently used for estate planning.
Powers of attorney may authorize an agent to manage assets that may become the property of the grantor’s estate after their death. 401(k) accounts, for example, may be held by the grantor.
Suppose the grantor becomes incapacitated and they have created a power of attorney. In that case, the agent may make investment decisions regarding the 401(k) until the grantor passes away, provided a valid power of attorney.
If another individual becomes incapacitated, a power of attorney allows one individual to act on their behalf. In general, it takes effect when the principal becomes incapacitated.
However, a power of attorney may also go into effect in other situations, including:
Powers of attorney can take many forms, including:
Powers of attorney may be effective at different times depending on the type.
Although you may be able to execute your power of attorney agreement independently, you must consult an estate planning attorney. An experienced Ohio estate lawyer can help craft the perfect agreement to suit your unique goals and needs while ensuring your form meets all of Ohio’s legal requirements.
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