What is the Role of Powers of Attorney in Estate Planning?

Powers of attorney are a cornerstone of estate planning in Arizona. These crucial legal tools ensure that loved ones know what to do in an emergency, but they must be executed properly. Here’s an explanation of what powers of attorney do, why they’re important, and how to make them legally binding.

What is a Power of Attorney?

A power of attorney (POA) is a legal document where you (called the principal) authorize a designated agent to act on your behalf if age, ailment, or other legal incompetence prevents you from making decisions for yourself. Powers of attorney avoid the need for family members to go to court to establish guardianship for a loved one who becomes incapacitated. They can also prevent family disputes by outlining your wishes and preferences if you cannot voice them. 

Types of Powers of Attorney in Arizona

Arizona has several types of powers of attorney:

• • General power of attorney – A general POA allows your agent to take any legal action that you might take, such as opening or closing financial accounts, signing contracts, or making investments. However, fiduciary duties limit an agent’s authority to act. For example, they cannot use your assets for their benefit. 
  • Durable power of attorney – A durable power of attorney allows someone to act as your legal agent if you become incapable. Without a durable POA, the agent’s authority would end if you become incapacitated. 
  • Medical power of attorney – A medical power of attorney, also called a healthcare proxy, allows you to appoint an agent to make healthcare decisions if you cannot. You may execute a medical power of attorney with a living will to instruct your healthcare proxy on your preferences or wishes regarding medical treatment or end-of-life decisions. 
  • Limited power of attorney – Also called a special POA, a limited power of attorney allows you to narrow an agent’s actions to a specific task or tasks.  

Legal Requirements for Powers of Attorney in Arizona

In Arizona, anyone 18 or older of sound mind and under no undue influence, duress, or coercion can execute a power of attorney. The principal, agent, and a witness must sign the power of attorney before a notary public. If you move from Arizona to another state, you should check your new state’s laws to ensure that your power of attorney meets that state’s requirements.

Common Disputes Over Powers of Attorney

Disputes often happen when family members disagree over the terms of their loved one’s POA. They may argue: 

• You didn’t have the capacity to execute a power of attorney.
• The agent used intimidation or deception to gain authority through a POA.
• The agent abused their authority to their own advantage or someone else’s. 

An Arizona estate planning lawyer can advise on how to choose the agent for your powers of attorney and plan carefully so your decisions withstand any challenges. 

Get Help From an Estate Planning Lawyer From Pennington Law, PLLC

Reach out to Pennington Law, PLLC to discuss how powers of attorney can enhance or improve your estate plan. Our experienced estate planning attorneys can help you draft, execute, and update the POAs as your personal and family circumstances change. Call or contact us today to request a free consultation.