When thinking about long-term care plans or estate planning, Colorado residents should think about creating a power of attorney. This document gives the agent the power to act for another person, known as the principal. Depending on the type of POA, the agent can have far ranging powers or limited authority and it can come into action at different times also.
A conventional power of attorney is one that ends when the principal becomes incapacitated. However, some people create POAs to specifically cover those instances that they are no longer able to make decisions for themselves, known as a springing POA. A durable POA remains in force both before and after the principal becomes incapacitated. Lastly, a medical POA is one that allows the agent to make healthcare related decisions for the principal in case he or she becomes incapacitated.
A general power of attorney is one that gives the agent the power to act on behalf of the principal at any given time and gives them a lot of powers. For example, he or she may be authorized to sign checks, sell property and handle bank accounts. A limited one on the other hand, gives only limited powers to act in specific defined instances. It can be limited by time, such as two years, or by events, such as handling a retirement account.
Before creating a power of attorney, one must think clearly about what type of instances it should cover and how long it should last. It is also important to know what all can be delegated in a power of attorney and what cannot—for example, a will cannot be revoked, made or amended through a power of attorney. Each state also has different specifications for a valid power of attorney, and what is legal in one may not be valid in another. Therefore, it might be helpful to consult a knowledgeable professional about the procedure.