When setting up an estate plan, most clients focus their time and attention on their Will and Trust and often give little thought to their Power of Attorney (POA) document. The Power of Attorney plays a vital role because there are certain things that could happen in life during a period of incapacity that a revocable trust and Will just cannot address. Here are three powers that every client should make sure are contained in their Power of Attorney.
First, the power to fund a revocable trust is a key power to have in all POAs. The reason this is important is that sometimes we discover that a client has not completely funded their revocable trust. If there is an incapacitating event and then the client later dies leaving an asset standing only in their name without a beneficiary designation attached, that asset could trigger a probate action after death. This could cost the client’s family a lot of time, money and stress having to probate the asset to get it moved over to the trust through the client’s Pour-Over Will.
Second, the power to manage digital assets is a wise choice to include in your POA. With this power, the POA agent may access, modify, control, archive, transfer, and delete digital assets. Digital assets include emails, email accounts, digital music, digital photographs, digital videos, gaming accounts, software licenses, social-network accounts, file-sharing accounts, financial accounts, domain registrations, Domain Name System (DNS) service accounts, blogs, listservs, web-hosting accounts, tax-preparation service accounts, online stores and auction sites, online accounts, and any similar digital asset that currently exists or may be developed as technology advances. As you can imagine, after the incapacity of a loved one, there may be important information needed to continue to run a business or manage a client’s financial affairs or even to make sure the family has access to photos that are important to the family.
Lastly, it is important to include the power to prosecute and defend legal actions in your POA. With this power, a POA agent may institute, supervise, prosecute, defend, intervene in, abandon, compromise, adjust, arbitrate, settle, dismiss, and appeal from any legal, equitable, judicial, or administrative hearings, actions, suits, or proceedings involving the person who set up the POA in any way. This authority includes claims by or against the person who set up the POA arising out of property damage or personal injury suffered by or caused by the person setting up the POA. The POA agent may also engage in litigation involving the person who set up the POA.
Now there are many other important powers that should be included in your POA document, but the above are some critical ones that could have a serious impact on nearly anyone. If you need to establish or update your estate plan, contact our Intake Department at (760) 448-2220 or at https://www.geigerlawoffice.com/contact.cfm.