Understanding Financial Power of Attorney in Michigan
A Financial or durable POA is an arrangement you make, with someone you trust totally, to handle your finances if you aren’t available, become incapacitated or in the event of your passing. A non-durable POA will last until the principal (you) revokes it, dies or becomes incapacitated. If you would like the agent to continue to act on your behalf if you become incapacitated, you would make it a Durable POA – agent is granted POA as soon as document is signed and will not end if you become incapacitated. In estate planning, almost all financial POAs are durable. There is also an option of a springing POA, this comes into effect on the occurrence of a specific event, usually incapacitation– you would need confirmation from at least 2 doctors and/or approval from the court for this to come into effect, the agent will have NO authority to act until you are determined to be incapacitated, which can take time.
What can a Financial POA do? Well, that, is entirely up to you. You can grant the agent full authority over your financial matters, or you can only authorize it for a single financial transaction, like signing real estate closing documents. According to a standard Michigan Durable POA form full authority would typically include:
All banking matters – deposits, withdrawals, access to safety deposit box, etc..
Investments – Invest, reinvest and withdraw funds
Government Benefits – Apply for and receive any government benefits for which yourself may become eligible for, including but not limited to, Social Security, Medicare and Medicaid.
Retirement Plan – Contribute, select payment option of, roll-over and receive benefits of any retirement plan or IRA.
Taxes – Complete and sign any local, state and federal returns, pay taxes and assessments due, receive credits and refunds and to sign any IRS documents necessary to effectuate these powers.
Insurance – Purchase, pay for and make claims on life, health, auto and homeowners’ insurance.
Real Estate – Purchase, sell, lease, repair, improve, mortgage and make mortgage and utility payments.
Personal Property – Hold personal property for safekeeping or to buy and sell personal property, including motor vehicles.
Legal Advice and Proceedings – To obtain and pay for legal services. Initiate or defend legal and administrative proceedings on my behalf.
You can put provisions in as you see fit, this is 100% up to you. A common provision that is put in is giving no authority to amend your will or trust or change beneficiaries.
Having a Financial POA is just as important as having a Medical POA. It’s important to carefully consider who would be best at managing your financial affairs, it doesn’t have to be the same person you appoint as your Medical POA. You would want to discuss this in depth with the person of your choosing so your final wishes are clear and they can make judgement based on your interest, should something happen to you.
It is important to know all the options that are available to you and make an informed decision on what would work best for your specific situation and needs. Please feel free to reach out if you have any questions. You can contact the Estate Planning experts at My Estate Plan Michigan at 248-744-4434 or email us at email@example.com.