We caught a great article in the Wall Street Journal last weekend (May 14-15, Weekend Investor section) about powers of attorney, and how they can be dangerous if the power gets into the wrong hands, and how they could be useless if they’re old or executed improperly.
In our practice, we counsel clients to carefully select their power of attorney – trust is paramount, and if there is even the slightest doubt that someone won’t have your best interests at heart, they aren’t the right choice.
We also counsel our clients to carefully choose which powers make sense in their POA documents. Unfortunately, it is impossible to predict future needs, so we must sensibly balance what powers we should allow for. One of those most abused powers in these documents is the gifting power. Usually, we limit how gifting can be done, and how much of your estate can be gifted at one time.
The WSJ article has some tips for folks that are setting up powers of attorney. A few of them include:
- Set up your POA early, while you’re still healthy and in control.
- Keep the estate plan, including the POA, current (We recommend every 3 years)
- Check with your banks and financial institutions, to ensure the POA will be valid and accepted by the institution (sometimes, institutions have their own POA forms they ask clients to use).
- If you are often in between two or more different states, have POA’s that comply with the respective state laws. In other words, have a POA for Pennsylvania, and if you are in Florida several months per year, have a POA for Florida as well.
A power of attorney in Pennsylvania that is more than 5 years old should be updated immediately. Let us know if we can assist you, by calling our office today at (215) 706-0200.