If you’re thinking about estate planning, good for you! Your goal is to make…
A Durable Power of Attorney is an essential and critical document for Elder Law planning. A common mistake made by many elderly individuals is to assume that a standard Power of Attorney they obtained in a stationary store or downloaded from the Internet will suffice for Medicaid eligibility planning purposes. These documents are not powerful enough to cover the broad spectrum of scenarios that can and often do arise.
New York State has enacted new rules and requirements that apply to all Durable Power of Attorney documents, to become effective on September 1, 2009. The net effect of this legislation is to provide you with more protection. It’s intended to reduce the incidence of potential abuse of rights and privileges you convey to your appointed agent.
Major changes to existing law include the following:
- Agents are required to acknowledge their responsibilities by signing and dating the document. The signature must be notarized.
- If you give your agent the power to make gifts from your assets, special language and a rider must be added to your Durable Power of Attorney. The rider must be validated by two witnesses.
- The authority to create certain types of Trust structures now has to be provided for in an additional rider to the Durable Power of Attorney.
- The ability to set up joint bank accounts, designate insurance beneficiaries, or to change beneficiaries on retirement plans must be specifically authorized with additional riders.
- The new law makes specific provisions for you to appoint an outside party to monitor the activity or your chosen agent. For example, you can require the agent to submit a record of payment and receipts for review to the party monitoring him or her.
- There is a statutory form of the Durable Power of Attorney that includes language specified in the legislation. Third parties who are presented with the statutory form of the document must accept it.
An experienced Elder Law firm is your best source for help with drafting the new document specifically targeted to your unique needs. To learn more about effective use of the Durable Power of Attorney Document, please see Strategy # 17 in Lamson and Cutner’s Special Report, 25 Strategies to Prevent Financial Ruin from Long-Term Health Care Costs.