Extended travel, illness or unforeseen incapacitation, are common reasons why people create powers of attorney (POAs). These documents are a legal framework where you can grant a trusted individual to act as an agent on your behalf. Here are five types of POAs available in Texas.
If you need specific financial advice or help with estate planning, consider working with a financial advisor.
1. General Power of Attorney
In many situations, such as extended travel or illness, an individual may require someone to manage their affairs. This is where a general power of attorney becomes a critical legal document. By granting this POA, the individual, known as the principal, appoints another person, called the agent or attorney-in-fact, to act on their behalf in a broad range of activities. The agent’s responsibilities can include financial transactions, real estate management and participation in legal actions. The POA remains in effect until the principal either revokes it, passes away or is adjudged mentally incompetent in some jurisdictions.
Despite these benefits, you should also note potential risks in granting a GPA. These can include the possibility of the agent misusing their power. To counteract this, it is advisable to appoint an agent whom you believe to be trustworthy. Additionally, you can implement safeguards to help protect your interests as the principal. These safeguards can include requiring the agent to provide regular updates to a third party, limiting the powers granted or setting an expiration date for the GPA.
2. Limited Power of Attorney
A limited power of attorney will similarly allow you to appoint an agent or attorney-in-fact so that they can perform specific actions on your behalf.
A limited power of attorney differs from a general power of attorney in that it has a much more limited focus, restricting the agent’s authority to certain tasks, timeframes or transactions. This makes it a good option if you just need coverage for a specific reason.
3. Durable Power of Attorney
A durable power of attorney is designed to ensure that your chosen agent can continue to oversee your affairs, even if you become incapacitated. This is different from a non-durable power of attorney, which loses its effectiveness if you are deemed mentally incompetent.
The durable POA is a common tool used in estate planning, specifically for long-term planning. It allows your agent to handle essential tasks such as managing financial affairs, making healthcare decisions and addressing legal matters on your behalf.
4. Springing Power of Attorney
Unlike a conventional POA, a springing power of attorney is effective immediately upon execution. It generally activates when certain predefined conditions are met, such as the grantor becoming incapacitated or otherwise unable to manage their own affairs.
This conditional activation can be particularly useful for individuals who are concerned about preserving their autonomy and wish to retain control over their decisions for as long as they are capable.
5. Medical Power of Attorney
A medical power of attorney allows you to appoint an agent to make healthcare decisions on your behalf when you’re unable to do so. This can help ensure that your healthcare preferences are respected and adhered to, especially when you may not be able to communicate your wishes.
The scope of authority granted to the agent through a medical power of attorney can be extensive. This can include decisions that accept or refuse medical treatment, access medical records and make determinations about end-of-life care.
How to Get a Power of Attorney in Texas
The process for preparing a POA requires careful consideration and strict adherence to legal protocols. To obtain a POA in Texas, here are five common steps:
- Determine the most appropriate type of POA for your situation, considering the scope and duration of the powers needed.
- Obtain the necessary POA forms, which can include Form POA-1 for general POAs and Form POA-2 for medical POAs.
- Complete the forms with precise information to ensure there are no ambiguities regarding the powers granted.
- Execute the document in the presence of a notary public or witnesses, as required by the Texas Estates Code and the type of POA being established.
- Ensure that the POA aligns with the stipulations set forth in the Texas Estates Code to guarantee its validity and enforceability within the state.
Before creating a power of attorney in Texas, you may want to consider getting professional legal help to ensure that it complies with all the legal requirements. Moreover, consulting an attorney could help prevent potential disputes or misunderstandings regarding the agent’s authority and the extent of the powers granted by the POA.
Bottom Line
A power of attorney in Texas can allow you to appoint a trusted agent to manage different affairs based on specific circumstances. Be it a general, limited, durable, springing or medical POA, you should be careful to appoint a trusted agent and consult with a legal expert to identify the benefits and drawbacks for your situation.
Tips for Estate Planning
- A financial advisor can help you create an estate plan for your needs and goals. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- Before trying to complete your own estate planning work, whether it’s creating your own power of attorney online or making your own will, make sure you understand all the potential dangers of DIY estate planning.
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