What is a power of attorney for finances?: A Power of Attorney for Finances and Property is a document in which you (the “principal”) name another individual (the "agent") to manage your finances and property. You determine the money and property you want the agent to have authority over, as well as the authority you want the agent to have.
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The authority can be broad or specific, depending on your preference. A power of attorney for finances may be “durable,” meaning that your agent may manage your finances in the event of incapacity or incompetence.
Why have a power of attorney for finances?: A Durable Power of Attorney for finances allows your agent to manage your finances even if you become incapacitated or incompetent.
Without a Durable Power of Attorney, your family may need to seek a guardianship in order to manage your money; apply for work-related disability, Social Security disability, or other benefits; access or change your retirement plan; file insurance claims or appeal denials; sign your tax forms; sell your home and help you move somewhere else; or hire accountants, lawyers, or other professionals on your behalf. Appointing a guardian is time consuming and expensive. The family must hire a lawyer who will arrange for a court hearing. A physician must provide evidence that you cannot handle your own affairs. And, if you are physically able, you must go to the courthouse to hear the testimony that you are incompetent.
When does the agent’s authority begin?: You may choose whether your agent begins managing your property immediately or at some later date or event, such as when you become incapacitated.
What is “incapacity?”: Whether you are incapacitated is determined in the following manner:
- A physician or psychologist’s finding that you have an impairment in the ability to receive and evaluate information or make or communicate decisions even with the use of technological assistance, such that you are unable to manage your property or finances.
- A judge, attorney, or appropriate government official’s finding that you are missing, detained, or are outside of the United States and unable to return.
- You may provide your own method by choosing a different individual who will decide whether you are incapacitated, and by creating your own definition of incapacity.
Does this prevent me from controlling my money?: The power of attorney document takes away none of your rights to control your property and finances. Your money is still your money. The document merely gives the agent permission to help manage your finances in a way that is consistent with your best interest.
When does the Power of Attorney end?: If at any time you are dissatisfied with your agent’s performance of their duties, you may revoke the power of attorney document. To revoke you must sign and date a document expressing your intent to revoke your power of attorney for finances. This document must then be given to your agent and your financial institutions to let them know that you have revoked your power of attorney.
There are many more decisions relating to the power of attorney for finances than are written here. If you have any questions about whether to create a power of attorney for finances, the agent’s duties, or your rights, please do not hesitate to call Attorney Heller-Neal at (262)902-0595, or via email: email@example.com.
For more basic information about the power of attorney for finances in Wisconsin, please see the Wisconsin Bar’s Q and A.