Can a Power of Attorney Create a Will?

By Laura Wallace Henderson

Planning for your future includes considering the possibility of your incapacitation. A legal document, known as a power of attorney, allows you to designate one or more individuals to take care of a variety of responsibilities if you are unavailable or incapable of performing these on your own. The details you include in your power of attorney document will help define the responsibilities and limitations this written instrument allows.

Wills

Your will allows you to provide instructions regarding your assets. This document may provide a variety of instructions including the division of personal property such as real estate, cash, personal belongings and stocks. Although the agent you list in your power of attorney may perform a variety of tasks, your agent can’t create or change your will. A power of attorney ends upon your death; a power of attorney document is not a substitute for a will.

Powers of Attorney

You can use a power of attorney for a variety of purposes. This document designates an agent, or attorney-in-fact, to perform certain tasks such as buying and selling property, filing your tax returns, managing your bank accounts and signing contracts. You can choose what tasks you allow your agent to perform, as well as provide a time limit for the effective term.

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Limitations

As in other areas of estate planning, state laws may vary in the ways they govern an agent’s actions. While your agent cannot create or revise your will, some jurisdictions allow your agent to create or amend trusts while you are living. Your agent may also have the authority to transfer money into your trust.

Considerations

When drawing up a power of attorney, choose your agent carefully. The responsibility you give to your agent depends on your individual wishes. Clearly define what responsibilities you want your designated agent to complete, as well as providing clear instructions on the limitations you wish to impose. Some individuals choose to elect more than one agent, sometimes listing their children or closest friend and attorney to co-manage the decisions. While electing more than one agent may allow several individuals to share the responsibilities, this action can also lead to conflicts if the agents disagree on necessary procedures and actions.

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References

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How to Create Power of Attorney Forms

A power of attorney is a legal document that authorizes another person to act on your behalf in certain specified situations. State law governs the creation and validity of power of attorney forms. These forms oversee the agency relationship between the principal, who is the person who created the power of attorney, and the agent or attorney-in-fact, who is the person receiving authority to do something in the power of attorney. Powers of attorney can authorize a variety of decision-making powers -- such as financial or health care decisions or decisions that affect your children -- in the event that you become unable to make such decisions.

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