A Power of Attorney is an easily customizable estate planning tool, commonly used by clients to fit their specific needs. The general purpose of a power of attorney is to give someone else the authority to handle your legal, financial or medical needs, if the time comes that you are unable to do it yourself. The agent’s authority or power is completely governed by the terms of the legal document you create. This means that your agent can only do what you instruct him to do in your power of attorney document. Can an agent under a power of attorney give gifts? The answer is: Yes. If you include the authority to make gifts on your behalf, then he will have the power to do so.
How much power should I give my agent?
The person creating and executing the power of attorney document is known as the “principal.” As the principal, you will be able to select and identify the person you want to serve as your agent, whenever the power of attorney becomes effective. The amount of authority you give your agent is determined by the terms of your document, which can give either general or limited power. The extent of the authority is always up to you.
The terms of a Limited Power of Attorney
If you decide to create a limited power of attorney, the terms must be very specific in describing the authority you are conveying to your agent. That is because he will only be able to exercise the powers specifically mentioned in a limited power of attorney. In other words, if you execute a limited power of attorney, and you want your agent to be able to make gifts for you, you must specifically state that your agent has the power to do so.
The terms of a General Power of Attorney
Alternatively, when you create a general power of attorney, your agent will be allowed to do nearly anything you would have been able to do. A general power of attorney is a very powerful legal document, conveying substantial power. When executing a general power of attorney, you can assume that your chosen agent will have authority over all of your assets. In that situation, the agent will have the ability to make gifts of your assets, in your name. An important exception, in most states, is the agent making gifts to himself or herself, while acting as your agent.
If you have questions regarding a power of attorney, or any other estate planning needs, please contact Sexton, Bailey Attorneys, PA online or by calling us at (479) 443-0062.