Estate Planning: What To Discuss With Your Attorney-In-Fact
To ensure that your family is taken care of if something should happen to you, especially if you have a sizable estate, you should have someone representing your best interests if you are unable to do so yourself. This person is called an agent or an “attorney-in-fact.” One of the first discussions you have with this person should involve expectations.
Who can be Your Attorney-in-Fact?
The person you appoint as your attorney-in-fact doesn’t have to be an actual attorney. They can be a trusted relative, your spouse, or a friend. However, if you own a business and have a sizable estate, you may want someone more objective to handle your affairs and you may want to have your lawyer appointed as your attorney-in-fact.
An attorney-in-fact operates under a general power of attorney (POA), which doesn’t restrict their authority and allows them to handle all transactions in your behalf. In the documentation appointing your attorney-in-fact, you can outline which transactions they should and which they should not be handling for you. It is important to determine if they are a “durable” POA or a “non-durable” POA.
A durable power of attorney continues after you’ve been deemed incapacitated, but a non-durable POA ends upon your incapacitation. Your attorney-in-fact should be a durable POA so your affairs can be taken care of if something does happen to you and you cannot make your own decisions.
What Should they do for You?
An attorney-in-fact is responsible for your financial affairs. You can appoint them to take care of real estate transactions, your investments, bank accounts and any tangibles items, such as your vehicles and personal property. You should choose which decisions you want them to make for you when you cannot make your own decisions. Do you want them to have access to your trust, financial accounts, and your business matters or do you want to limit what they can do?
You should discuss the responsibilities you want your attorney-in-fact to handle on your behalf. If you own a business, they can operate the business for you. They can keep receiving your benefits on your behalf, handle all your banking and investment transactions, pay your bills, pay taxes on your behalf and make other decisions that you have included in the documentation appointing your attorney-in-fact. Their duties should be clearly outlined so if there is a dispute, their responsibilities on your behalf have been legally documented.