Power of Attorney: Power in Your Hands

Power of Attorney Power in Your Hands By Robert ShawWhat is a power of attorney? When an individual sets a power of attorney, it means they have appointed a trusted person to act on their behalf regarding any non-medical decisions, such as banking transactions or selling a home, if they are unable to do so because of incompetence or physical inability. The power of attorney is generally a durable power, meaning that it remains valid as long as the principal who made the appointment is unable to act themselves, and requires the signature of both the principal and the agent. For medical decisions, a healthcare proxy is needed.

How Do I Start a Power of Attorney?

With professional guidance and careful thought, a legal form is completed. The New York State Statutory form lists a number of different boxes that have to be initialed if one wants to give power of attorney. If the box is not initialed, the power is not effective. One has the right to modify the power of attorney, but those modifications must be made in Section (g) on the New York form.

One also has the right to appoint what’s known as a monitor under the power of attorney. A monitor is put in place to supervise the actions of the appointed agent. It is rare that a monitor is appointed, though, as it is usually an inconvenience and can cause conflict.

Who Should I Appoint?

When choosing a power of attorney, one person or multiple people can be appointed; for example, naming just one child or two children.

There are pros and cons both ways. The pro is that two people have to act jointly to make the decision so that one person can’t take advantage. The con is that it’s more awkward as a practical matter, particularly if they don’t live in the same geographic area.

Most people prefer to have just one trusted person appointed. Sometimes, though, conflicts in the family and jealousy amongst siblings may be reasons for multiples. In that case, the principal has to make the decision whether those siblings can act separately or whether they’re required to act together.

New York Statutory Gifts Rider

In New York state, one can’t make a gift of more than $500 unless a New York Statutory Gift Rider is attached to the Power of Attorney. The rider must also:

  • Be executed at the same time as the power of attorney;
  • Have the signature of two witnesses;
  • Specify whether the agent is allowed to make gifts to himself or herself, such as transferring ownership of a home or a bank account; and
  • Indicate whether or not the agent is limited to transfer up to the federal gift tax exclusionary amount, which is $14,000, or if there is unlimited gifting.

Any modifications to the gift riders must be done under the modification section, which is section (b).

If you have any questions or comments regarding a power of attorney, or if you have been appointed as an agent under a power of attorney and don’t know what steps to take, please contact me.

 

Robert Shaw

 

Robert W. Shaw, Esq.
(914) 328-1222

E-mail Bob

 

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Robert W. Shaw is licensed in New York.