POWERS OF ATTORNEY IN NORTH CAROLINA

What They Are and Why You Need Them

What Is a Power of Attorney?1

A legal document that allows you to select someone to act for you

giving that person specific legal authorities and the ability to make legal decisions on your

behalf

What Do They Do?2Powers of attorney

are very powerful and flexible documents

No two are identical, and through them you can pass on specific decision-making abilities to

someone else

Medical decisions

Financial decisions

The ability to enter into contracts

Supervision of children

Almost any other legal choice you can make

How Do You Make a POA?3

You can only give someone elsethe right to make decisions on your behalf

if your power of attorney meets all North Carolina legal requirements

• You can only make a power of attorney if you are capable of legally making your own decisions

Sound Mind

• Only an adult can grant power of attorney

Age

• You have to make a document granting power of attorney

In Writing

• You need to sign and notarize your power of attorney

Signed and Notarized

What Are the POA Terms?4Powers of attorney can be

as broad or as limited as you like, but are typically divided into

two different types

• Give someone else the right to pay your bills for you, enter into contracts on your behalf, manager finances, invest your money, or other specific financial abilities

Financial

• Give someone else the ability to make medical decisions for you should you become medically incapacitated or otherwise unable to make your own decisions

Healthcare

Financial Power of Attorney5Financial powers of attorney

are very useful, especially if you’re going on vacation, have complicated financial

affairs, or are planning ahead for potential incapacity

Through these documents you can pass on decision-making rights

in a number of areas

Everyday financial management such as bills or other payments

Buying, selling, or maintaining real estate

Paying taxes or preparing tax returns

Operating your family business

Transferring property to a trust

Managing financial investments

Healthcare Power of Attorney6Healthcare powers of attorney

allow your agent to make medical decisions

after you are incapacitated

Allowing or refusing artificial nourishment or hydration

Allowing or refusing medical procedures

Allowing or refusing the performance of heroic life-sustaining measures

Attorney-in-Fact7

The person you choose to represent your interests is called an agent or an attorney-

in-fact

It can be almost anyone you choose, but that person will have specific authority as granted

under the power of attorney and the terms you choose

Not Necessarily a Lawyer•The title “attorney-in-fact” does not require you to appoint a lawyer, nor does it mean your agent can act as an attorney. It simply means that person represents your interests.

Fiduciary•Your agent can not take advantage of his or her position to better his or her own interests. Your agent has to act with your best interests in mind.

Capable•You must appoint a capable adult as your agent and not someone who is mentally infirm, under the age of 18, or otherwise unsuitable to perform the duties as your representative.

WillingYou cannot force anyone to be your agent. The person must be willing to serve in the position.Individual or OrganizationYour agent can be a single person, multiple people, or representatives of an organization that you appoint to the position, such as your bank

Durable Power of Attorney8If you want your agent to act

after you have become incapacitated you must create a durable power of

attorney

Non-durable powers terminate

as soon as you are incapacitated

Limited, General, or Springing POA9

The person who creates a power of attorney, called a principal, gets to choose how broad the agent’s authority is and how

long the powers last

Limited

• These powers grant specific authority to the agent but only in a limited capacity.

General

• These grant the agent the most possible authority under the law.

Springing

• These powers only take effect if specific circumstances happen. For example, a springing power of attorney could give your agent authority to manage your finances if you are ever in an accident or otherwise incapacitated.

Revocation10

As a principal you remain capable of altering or revoking the power of attorney

at any time

Automatic

• The power of attorney automatically terminates as soon as you die.

Notification

• Your agent has the authority to act on your behalf for as long as he or she remains aware that the power of attorney is in effect. To effectively revoke it you must notify the agent of the revocation.

Alteration

• You also retain the right to effectively change the agent’s powers. This is typically done by revoking the old power of attorney and adopting a new power of attorney that states the new limitations.

Non-passable Powers11

Powers of attorney are NOT suited for ALL purposes

There are some inherent limitations with these documents

Legal AuthorityYou cannot give your agent the right to make or modify your will, choose a guardian for your child, vote in an election, or other rights that only you have.ProbatePowers of attorney terminate on death, so if you want your agent to act as your probate representative you need to appoint that person as your executor in your will.

Act Now, Change Later12

It is always best to have a power of attorney ready

than to need it yet not have it

Creating a power of attorney under emergency situations is never a good idea, as these

documents require planning and preparation

Act NowYou can create powers of attorney now that will

only spring into effect should an emergency arise.

Change LaterIf you want to change your powers of attorney, it is relatively simple to do this later, especially after

you’ve already gone through the process of discussing what options you have.

Not Enough for Everything13

Powers of attorney are very useful, but they are not the only legal

document you need when creating an estate plan

Here are some others you will likely need to create

Last will and Testament

Trusts

Living Will

LEARN MORE ABOUT POWERS OF ATTORNEY

IN NORTH CAROLINAPOWERS OF ATTORNEY

IN NORTH CAROLINA

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