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How 'Durable' Is Your Power of Attorney?

Put most simply, a power of attorney (POA) is a legal document that enables someone you choose to make decisions on your behalf. This person is known as an agent, or agent-in-fact, and their duties and abilities are typically restricted to those that are specified within the POA document.

It’s important to understand that there are different types of POA designations, providing your specified agent with different degrees of authority. In Illinois, there are two types of POA that individuals need to consider, in most cases:

  • Power of Attorney for Healthcare: This designation gives your chosen agent the ability to make medical decisions on your behalf
  • Power of Attorney for Property: This designation grants your chosen agent to make financial, property (and, often, legal) decisions on your behalf

For the purposes of estate planning, it’s also important to understand another wrinkle that comes with granting both financial and medical powers of attorney – namely, the difference between durable and non-durable powers of attorney.

Durable Vs. Non-Durable Powers of Attorney

Broadly speaking, the authority of a non-durable POA ceases when the principal (or the person granting the powers) is deemed mentally incompetent. On the other hand, a durable power of attorney automatically extends the duration of the POA, meaning that it will stay in effect should the principal become incapacitated and incapable of handling matters on their own.

If you so choose, you can add language to any type of POA to make the designation durable, and extend the duration of your agent’s authority at a vital time.

While this may seem like a small distinction in theory, its impact can be enormous in practice.

While most of us don’t like to think about it, there is always the very real chance that we may end up incapacitated at some point in the future. When this occurs, having a durable POA in place can make it much easier for your friends, family, and trusted advisors to handle affairs on your behalf – including making important, potentially life-saving medical decisions.

Without a durable power of attorney in place, your loved ones may well end up having to go through a court process just to gain the authority to handle your affairs. It goes without saying that this may be a slow, trying, and costly undertaking – potentially compounding their stress at an already-turbulent time.

Power of Attorney: More Considerations

With all of this being said, some people are hesitant about the idea of granting POA, fearing that they’re sacrificing their independence, or giving someone the power to make binding decisions that run contra to their wishes. This is understandable – and there are certain safeguards in place to help prevent these worst-case scenarios from coming true.

For one thing, individuals can usually exert a pretty significant level of control when it comes to designating the scope of their POA. As with, say, a revocable living trust, the principal of a POA may also revise or revoke the document at any time, provided that they are considered mentally competent. You may also create a “springing” POA, which does not go into effect until a specified date, or until after the occurrence of a specified event.

It’s also important to recognize that, as a principal, you may limit your choices of proxies to individuals that you trust completely, and set down legally binding guidance that your agents must follow, using mechanisms such as a health care declaration or living will.

If you’d like to discuss any topics pertaining to powers of attorney in more depth, our team would be happy to help. Don’t hesitate to drop us a line with any questions or concerns about any aspect of the estate planning and administration process in Illinois, including wills and trusts, probate, or powers of attorney. Our talented team will make sure you feel supported and informed at every step of the way.

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