Types of Powers of Attorney
General: broad and substantial powers, includes finances, contracts, tax filing, employment, claims and litigation, personal and family maintenance, business operations, and the right to delegate. Unless specifically stated in the power of attorney document, gifting is not permitted.
Limited: specific powers, authorizing the agent to do something specific, like sell a house or collect a debt, or buy/sell a stock.
Trading authority: This is limited power of attorney that financial firms may offer customers. “Limited trading authority” generally permits buying and selling, but not withdrawals or redemptions. “Full trading authority” permits buying, selling, redemption, and withdrawals.
Financial Power of Attorney: As its name indicates, this power of attorney covers financial decisions only. Authority can be as broad or narrow as the grantor wishes.
Child Care Power of Attorney: If a child spends extended periods with someone other than the parent, this authorization may be necessary. Schools and doctors may request it.
Springing Power of Attorney: a power of attorney that “springs” into effect after a trigger event such as a medical event or a legal decision – for example if a court determines someone is not competent.
Statutory Power of Attorney: based on statutes of a state or jurisdiction. Typically, states have statutory powers of attorney that follow state law. Statutory powers of attorney typically include durability language.
Durability: Any power of attorney can be made “durable” by adding language affirming that should the grantor become incompetent, the power of attorney will continue to be effective. Today, most Power of Attorney forms include durability language. The intention is to make sure that if the principal becomes incompetent, the power of attorney will survive such an event and the agent will be authorized to act on the principal’s behalf. However, if durability l