Do You Have a Power of Attorney In Place?
Have you ever packed for an early fall trip and the weather forecast for your destination was uncertain? What did your suitcase look like? Raincoats and winter jackets, bathing suits, shorts and jeans, T-shirts and sweaters all packed together like subway commuters during rush hour. No question, you were prepared for whatever Mother Nature unleashed. You also had a very heavy suitcase. Long Term Estate and Health Care Planning operates in a similar fashion.
I hesitate to compare a Power of Attorney to anything related to vacation preparation, but not having a Power of Attorney is like missing a warm jacket when the temperature drops. A Power of Attorney allows a trusted person to handle your financial affairs. The importance of this form becomes apparent following an illness. An individual lacking the physical or mental well-being to pay bills, transfer funds or communicate with financial institutions cannot adequately protect their savings.
For the Agent under of Power of Attorney, the form provides a simplified way to accomplish tasks. The Power of Attorney is filed with the institutions, utilities and other entities that have relationships with the ill person. The Agent can then pay bills, receive statements and protect resources – especially if Medicaid is necessary to pay for long term care. There is a New York Statutory Form that has two parts. One part is a traditional listing of the duties and responsibilities of the Agent under a Power of Attorney including banking and real estate transactions among others. The creator and the Agent have their signatures notarized. The second part of the New York form has a Statutory Gift Rider which controls the amounts and types of financial transfers, the ability to change beneficiaries, create trusts and a host of other planning duties. This Gift Rider is also signed by the creator in front of a notary and witnessed by two people. Both parts of this New York Power of Attorney should be executed to avoid future difficulties during the Medicaid Planning process.
Banks and financial institutions have their own Power of Attorney forms. Some financial institutions insist on using their forms and make it difficult for Agents to file the New York form. Find out if your banks or brokerages accept the New York form.
Not having a Power of Attorney means that the ill person must be present in person or on the phone to handle basic tasks. This may prove impossible as an illness progresses. In cases like this when an individual’s capacity is compromised a legal proceeding known as an Article 81 Guardianship is necessary to appoint someone to handle their property. Court proceedings can be expensive and complex. A few minutes of proper planning may avoid days and weeks of aggravation.
When the temperature drops and every part of you is freezing you appreciate the warm jacket and the smart packing job. Pulling out the completed Power of Attorney during a health crisis offers a similar sense of security. Contact the professionals at Sloan and Feller today to discuss the Power of Attorney and its role in protecting your family’s assets.