New York State’s new rules governing the use of the Durable Power of Attorney document are designed to make sure that, when granting powers to an agent, you fully understand what you are doing, particularly when the agent is being given the power to make major gifts of your money or property, to himself or others. Also, the agent is now required to acknowledge his responsibility to act in your best interests, and to sign the document himself.
Here are a few of the specific provisions in the new law regarding the Durable Power of Attorney:
- Your property must be kept separate and distinct from any property individually or jointly owned by your appointed agent.
- Your agent may not transfer any property to himself or herself without your specific authorization.
- Agents are required to avoid conflicts of interest.
- Your agent must keep records of payments, receipts and other transactions, and produce them for inspection at your request, or at the direction of another party you choose to monitor his or her conduct. Certain government agencies are also entitled to inspect records.
- Records need to be made available for inspection with 15 days of a valid request.
- If your agent does not comply with authorized requests for inspection of records and activities, special proceedings are available under the new law to force compliance.
- Agents can be legally liable for failure to act according to a prudent person standard in relation to your finances and assets.
To learn more about why a Durable Power of Attorney is so important in regard to Elder Law strategies, Medicaid eligibility and estate planning, see Strategies # 17 in Lamson and Cutner’s 25 Strategies to Prevent Financial Ruin from Long-Term Health Care Costs.