General power of attorney is essentially an agreement that gives another individual the power to legally act on your behalf. This agreement is created by a power of attorney document, which specifies a principal, who is the person granting power of attorney, and an attorney-in-fact, who is the person that will be acting legally on the principal’s behalf.
What Rights Are Granted Under General Power of Attorney?
General power of attorney, as the name suggests, grants broad (read: general) powers to the attorney-in-fact. When in effect, that person will be able to do the following on the principal’s behalf:
- Open and close insurance policies and bank accounts
- Conduct financial and business transactions
- Handle important personal decisions
- Administer business related to estate planning
- And anything else the principal would legally be allowed to do
Who Needs General Power of Attorney?
There are a variety of different circumstances where it would make sense for an individual to grant someone else with general power of attorney. For example, if an individual who lives alone and has no relatives were to go for invasive surgery, that person would want to grant someone general power of attorney. Why? Because if anything unfortunate were to transpire during surgery, it would be necessary for someone to be able to make important decisions while the principal is incapacitated.
However, the situation does not always need to be so extreme for a general power of attorney agreement to make sense. For example, if someone were to be travelling outside of the country for an extended period of time, that individual may want to grant someone with general power of attorney to act on his or her behalf. This would allow the principal to ensure that his or her financial and business matters are conducted during his or her absence.
Finally, general power of attorney is usually an important part of estate planning. It establishes who will be in control if an individual is no longer able to make important decisions with respect to the administration of his or her estate. Because of the broad powers granted by general power of attorney, the attorney-in-fact would be able to conduct any estate planning tasks, such as opening trusts, that the principal is unable to see through for his or herself.
How Is General Power of Attorney Distinct From Other Kinds?
Without a doubt, general power of attorney is the broadest of all possible power of attorney agreements that can be reached. As you’ve already seen, it gives virtually limitless power to an individual to act on your behalf. This is most distinct from special power of attorney, which allows the principal to specify what actions the attorney-in-fact will be able to take on his or her behalf. Finally, there is the narrowest form of power of attorney, which is healthcare power of attorney. In this agreement, the attorney-in-fact is permitted to make medical decisions on the principal’s behalf should the principal, for whatever reason, be unable to make those decisions for his or herself.
If you have questions about power of attorney or need to complete a power of attorney document, call our offices today.
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