Post on 08-May-2015
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POWERS OF ATTORNEY IN MINNESOTA
Issues, Facts, and Commonly Asked Questions
WHAT IS A POWER OF ATTORNEY?1
Created by a
Principal
Legal Document
Empowering an Agent, also known
as an Attorney in
Fact
Giving the Agent
specified Powers to act
on the Principal’s
Behalf
WHAT DO THEY DO?2
Principals can give their agents numerous different types of decision-making authority
The power to sell or manage your property
Manage your everyday finances
Purchase real estate or insurance on your behalf
File your taxes
And more
HOW DO YOU MAKE A POWER OF ATTORNEY?3
In Minnesota you can only create a power of attorney in writing
DocumentMinnesota law
provides a standard form you can use.
You can also create your own form to
suit your own purposes.
Signed
The principal has to sign the power of attorney form
in front of a notary public.
Dated
Power of attorney
document has to be clearly dated.
Specific
The document must detail the
powers the principal is giving
the agent.
CREATING THE POA
GRANTING POWERS
When granting power of attorney, only the principal can decide what powers to give
However, all those powers must be
specifically granted or, if the principal wants to give broad powers, the
power of attorney document must specify that it transfers general power
Limited powers
These are specific powers granted to the agent by the principal. All other rights and abilities not given remain solely those of the principal.
General
Giving general powers of attorney transfer all possible rights to the agent
CAPACITY
If you want to create a power of attorney you
have to meet some
minimum legal requirements
Mentally sound. You can only grant power of attorney when you maintain the ability to make
your own choices and understand how those choices affect others. You cannot give power of
attorney when, for example, you are delirious, suffering from a mind altering disease, or are
otherwise incapable of understanding your own decisions.
Adult. You must be at least 18 years old create a power of attorney.
AUTHORITY
Creating a power of attorney
does not give away your rights, it simply allows your agent
to act on your behalf
Termination• If you are not happy with
how your agent is acting you can terminate the agent at any time as long as you are mentally sound
Modification• The principal has the right
to change the power of attorney terms at any time as long as he or she remains mentally sound
YOUR AGENT
When the principal chooses someone to act on his or her behalf,
that person earns the title of attorney-in-fact, also called an agent
Lawyers not necessary. The title “attorney-in-fact” does not mean you have to select a lawyer. It also does not give
your agent the right to practice law.
Fiduciary. An agent has the legal responsibility to do what is in the principal’s best interests.
Capable. Just like someone who makes a power of attorney, an agent has to be legally capable of serving in the
position. You must select a capable adult of sound mind. Minor children cannot serve as an attorney-in-fact.
Voluntary. Your selection of attorney-in-fact has to be willing to serve. If the
attorney-in-fact declines to serve or, after accepting, chooses to stop being your agent, you should have a replacement
agent ready.
Person or organization. You can select either an individual or an organization.
Depending on the kinds of responsibilities you want your agent to carry out, one
choice may be more suitable than another.
WHAT IS A DURABLE POWER OF ATTORNEY?4
Durable powers continue to allow the agent to act on your behalf even if you lose your
ability to make decisions
Incapacitation• As a general rule, should
you become mentally incompetent all powers of attorney will automatically be terminated
Exception• However, if you create a
durable power of attorney, these powers will continue to remain in effect even if you become incapacitated
DEATH
All powers of attorney, whether durable or not,
terminate once the principal dies
Notification
An agent can continue to act as long as he or she believes the principal is alive, or as long as he or she believes the powers of attorney are still in effect. Once notified of the principal’s death, the agent’s power ends.
Estates
Principals commonly choose agents to continue to represent them after the principal has died. If this is the case the principal has to nominate the agent to serve as executor, also known as a personal representative, through the principal’s last will and testament.
OTHER CONSIDERATIONS5
Powers of attorney allow you to choose who represents you
Should you become incapacitated but not dead, someone will have to manage your affairs
CONSERVATORSHIP
If you don’t choose who that person is a court will have to do it for you
CONSERVATORSHIP
If you don’t choose who that person is a court will have to do it for you
Spouse
• The property that you and your spouse owned together will still be managed by your spouse, but there are significant limits to what a spouse can do.
Conservator
• A person a court appoints to manage finances is known as a conservator.
Probate
• To appoint someone the court will have to hold hearings.
INHERENT LIMITATIONS
There are some things agents are
never allowed to do
Creating a power of attorney that grants any prohibited powers could result in a court finding the power of attorney is
invalid
Non-Delegable
• Your agent cannot vote for you in a general election, cannot create or modify your will, or do anything else that cannot be delegated by the principal.
Probate
• As mentioned before, a power of attorney is not a suitable choice to appoint someone to manage your estate after you die.
CONCLUSIONS6
TIME IS ALWAYS AGAINST YOU
You don’t have to wait until an emergency arises
to create a power of attorney
In fact, doing so then is always worse than creating one when you have the luxury of time because you can think
more clearly about the issues involved
You can always create a springing power of
attorney that only takes effect should you become incapacitated later
Having the powers of attorney in place and
ready to use is always better than having to
scramble to create them
PART OF A LARGER ESTATE PLAN
Powers of attorney are very useful, but they are not a cure-all
A good estate plan includes other necessary elements
that have abilities powers of attorney cannot grant
Last will and testament
Nominate a guardian, executor, and decide how you want to dispose of your property after you die.
Trust
Transfer your property to the trust and nominate a trustee to manage it and distribute it as you direct.
LEARN MORE ABOUT MINNESOTA POWERS OF ATTORNEYMINNESOTA POWERS OF ATTORNEY