A power of attorney, or attorney letter, is a form that grants someone the ability to make legally binding decisions for another. An individual may use a power of attorney for personal and business reasons. How a power of attorney is executed depends on the laws of the state where the transferor is located. The Uniform Power of Attorney Act provides a basis for general standards that may be applicable across many jurisdictions. The UPAA has been enacted by 11 states as of January 2012.
Assess the situations you need your designated representative to handle. A power of attorney is normally drafted in response to circumstances where you expect to be unavailable and need someone to act on your behalf. Examples of situations where a power of attorney would be helpful include medical emergencies when you are unconscious and financial transactions where you are unavailable.
Determine the degree of power you wish to transfer. You generally only want to assign as much power of attorney necessary for the representative to meet the needs of the circumstances. A general power of attorney grants your representative unlimited power to manage your assets and financial affairs, and a durable power allows the agent to retain that power if you become incapacitated. A limited power of attorney restricts the agent to using his power only in defined, specific circumstances.
Obtain a power of attorney form that is valid in your jurisdiction. To ensure your power of attorney complies with your state's legal standards, you can check the website of your state's Secretary of State for blank forms.
Draft the power of attorney. When drafting a power of attorney, it is important to specify what powers you are conferring and in what circumstances those abilities may be used. For example, you might write a power of attorney to grant a representative the authority to enter into a contract with a supplier.
Sign the power of attorney. The person who wishes to transfer authority using the power of attorney must either sign the document or have the document signed in her presence. Although state requirements vary, some require the document to be notarized by a notary public.