When Do You Need a Special Power of Attorney?

A special power of attorney can help you take care of business when you're unavailable.
A special power of attorney can help you take care of business when you’re unavailable.

Yahoo Finance’s recent article entitled “What is Special Power of Attorney?” explains that with a general power of attorney, you can designate a person to make decisions when you are unable, due to illness or incapacity. A general power of attorney allows your agent (the person you select) to do almost anything related to your financial affairs that you could do, including, for example, file your tax returns, sell your house, access bank records, or sign financial contracts in your name. There are usually few, if any, limitations.

A special power of attorney only applies to specific circumstances. This is also called limited power of attorney. An agent named in a special or limited power of attorney can only act in situations included in your power of attorney document. Maybe you’re traveling or out of town when an important transaction need to take place. A special power of attorney is often used to sell property when the buyer or seller is unable to attend the closing in person. In a special power of attorney you can set limitations and conditions under which your agent is authorized to act.

You can have multiple special powers of attorney, depending on your situation. You may want to give one agent the power to run your business while you’re away and give another agent the power to sell your car.

Remember that a special power of attorney, like a general power of attorney, only applies during your lifetime. If the special power of attorney does not include a date when it terminates, it must end when you pass away. Your assets would then be managed pursuant to the terms of your will or trust, if you have either. If a person dies without a will, then in most cases the assets are distributed according to the probate laws of the state where the person lived.

Typically, creating special power of attorney involves the following:

  • Naming a person to act as your agent
  • Detailing the specific terms under which a power of attorney will take effect
  • Determining which authority your agent will have
  • Designating a successor agent, if necessary, and
  • Choosing an end date for the power of attorney to terminate

A special power of attorney is just one of the documents you may need for your estate plan. You should also ask your estate planning attorney about a last will and testament and a living trust to help you manage assets, according to your wishes after you pass away. Other critical documents include advance health care directives which state the kind of care you should receive when you can’t make medical decisions for yourself.

For more information on other estate planning documents you may need see https://galligan-law.com/living-wills-and-medical-powers-of-attorney-why-they-are-important/.

Reference: Yahoo Finance (Feb. 28, 2020) “What is Special Power of Attorney?”

 

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Your Nosy Neighbor Can Find Out About Your Probate

Your neighbor can find out all about your probate process and the assets you owned.
Your nosy neighbor can find out all about your probate process and the assets you owned.

Most people think of probate (the process of collecting, managing, and distributing a deceased person’s money and property) as a private process. However, because wills are filed at the courthouse, probated estates become a matter of public record. That means your nosy neighbor from down the street or a long lost family member can simply go down to the courthouse or hop online and find out about your probate and the assets you owned. Really.

And it’s not just your neighbor who has access to this information. After a death, Texas law requires that the person having possession of the deceased person’s will must file it with the probate court –even if there won’t be any probate court proceedings.

While your neighbor may be an annoyance and have no reason to view the information other than out of curiosity, others can get access to your public records and make your beneficiaries’ lives miserable.

Financial predators.

While today’s digital world is convenient, it’s also dangerous. Financial predators find ways to access sensitive personal information online. Since courts are part of a bureaucratic process that often moves slowly, months can elapse before you (or the court) realizes that your beneficiaries have been swindled.

Will Challengers.

Since a will that is filed with the probate court becomes a public record, those believing they have an interest (whether valid or invalid) can access the document and challenge the will. This can result in added costs and time defending the will from what could amount to a frivolous claim.

Avoid the “Nosy Neighbor” Factor with a Revocable Living Trust.

Revocable living trusts are almost never filed with a court, either before or after your death. Probate courts are not involved in supervising your trust administration. So, you can avoid intrusions by busy bodies and predators by creating a revocable living trust. A trust is the best way to keep your financial and family affairs private.

For more about estate planning issues see https://galligan-law.com/practice-areas/estate-planning/.

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Does Your Executor Know What to Do?

Don't leave a mess for your executor clean up. There are ways to make your executor's job easier.
Don’t leave a mess for your executor clean up. There are ways to make your executor’s job easier.

Next Avenue’s recent article entitled “Is Your Estate as Planned As You Think?” explains that when you pass away your executor will have many tasks to perform when settling your estate.

It’s helpful to add clarity and lessen the burden of your executor’s work in advance. Look at this list of things to make sure your estate is as planned as you think it is:

Is your will current? If you’ve written your will, how long has it been since you drafted it? Have there been any major changes in your life since that time? If so, it’s likely time to update it. Review your will to make certain that it’s an accurate representation of your assets and your wishes now.

Is your will detailed? Yes, you’ve addressed the big stuff, but what about smaller items with sentimental value? You should list who gets what, to avoid fighting, especially if the executor is one of your beneficiaries.

Do you have a way to distribute your other personal items? You should determine how your family will divide up the possessions not explicitly listed in your will, such as the lawnmower, dishes and photographs. All of it will need to be either distributed by the executor to one of your beneficiaries, donated, or sold.

Are your financial affairs organized? Your executor will need to know if you have any recurring payments, as well as your account number, and online passwords. Create a list of regular monthly bills, along with your account numbers and access codes to simplify your executor’s job.

You will also need to let the executor know about any automatic deductions or charges on your credit card, internet-based subscriptions, club memberships, recurring charitable donations and automatic utility payments.

Making your wishes clear for your executor can help ensure that there’s less stress and an easy distribution of your assets.

Your estate planning attorney can help you address these issues to make things easier for your executor and your family. And while speaking with your estate planning attorney, ask about advance medical directives such as a medical power of attorney, a living will, a HIPAA waiver and whether you should have a trust.

For more information on wills see https://galligan-law.com/understanding-why-a-will-is-important/.

Reference: Next Avenue (Feb. 25, 2020) “Is Your Estate as Planned As You Think?”

 

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