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Illinois Powers Of Attorney FAQ | Financial Powers Of Attorney

Updated on
November 9, 2020
Article written by
Attorney Kevin O'Flaherty

This article will cover the frequently asked questions relating to financial powers of attorney in Illinois. To learn more about medical powers of attorney, check out our article Illinois Powers Of Attorney FAQ | Medical Powers Of Attorney.


What is “Power of Attorney?”


Power of attorney is a legal document that grants someone else the authority to make decisions and take actions on your behalf if you become mentally or physically incapable of doing so. A financial power of attorney should handle financial matters, and a medical power of attorney should address medical issues.


Can the same person serve as my medical and financial power of attorney?


Yes, they can be the same person, different people, or multiple people for both. However, when you appoint more than one individual as your PoA, it can extend the decision making time.


Can I appoint my son and my daughter as financial power of attorneys?


Yes. You can appoint both your son and daughter or any other two or more people as your financial power of attorney. However, when you draft your power of attorney you must indicate if they have to collaborate or if one supercedes the other. It’s not uncommon to name a primary power of attorney and a secondary in case the primary becomes incapacitated. Or you may want both of them to have to sign off on a financial decision before it can be made legal.


What responsibilities will my power of attorney representative have?


Your representative’s authority is only limited by how you draft your power of attorney document. You decide what power and responsibilities they have. You can opt to only give them a very narrow range of powers, such as the power to deposit a check into your bank account or take out a limited amount of money each week for a specific reason. Conversely, you can give them the power to do anything you can do if you were present. You may want to limit your representative’s responsibilities if you are only partially incapacitated, but add a clause that gives them complete power if your situation worsens.


Does power of attorney last forever?


Simple power of attorney, not durable power of attorney, only lasts as long as you are physically and mentally capable of reviewing and modifying the actions of your assigned power of attorney. Once you lose the ability to make your own decisions and take your own actions, simple power of attorney is no longer valid. At this point, you will need to have a guardian and conservator appointed for you. Simple power of attorney is standard for business and legal matters when you can’t be present. For example, when buying or selling property, you are often asked if you want to sign a power of attorney to handle the transaction, so you don’t have to be there yourself.


How do I guarantee that my power of attorney will kick in if I become incapacitated?


There are a handful of options to protect you, your business, and your loved ones in the event you become incapacitated. One of those is the durable power of attorney. Unlike the simple power of attorney, the person you appoint as durable power of attorney retains his or her control over actions and decision making in your stead, should you become incapacitated.


Do I give up certain rights when I appoint a durable power of attorney?


Not necessarily. You should think of a durable power of attorney as a partner in decision making. When you are cognizant and not incapacitated, the durable power of attorney can share control of your affairs with you. You can customize the legal relationship as your situation demands, but once you die, the durable power of attorney should assume control over your financial and medical decisions.


How do I check if a power of attorney I already executed is a durable power of attorney?


The quickest way would be to question the law office that handled your power of attorney. If that’s not an option or they don’t have the records, you can review the paperwork in your possession. If the power of attorney document has a sentence that reads, “This power of attorney shall not be affected or considered null and void by the disability or incapacitation of the principal.” The language may differ, but if it seems to suggest that the power of attorney should remain in effect regardless of your physical and mental capacity, then it is probably a durable power of attorney.


What happens if I don’t have durable power of attorney?


Suppose you don’t have durable power of attorney, and you become physically or mentally incapacitated. In that case, you place a significant burden on your loved ones who must go through the court system to deal with expensive, time-consuming, and challenging problems. Who decides whether you stay in the hospital, go to a nursing home, or are cared for at home? How can your loved one access your funds to pay for bills? In the absence of a durable power of attorney, your loved ones will have to go through the legal process to have a conservator and guardian appointed for you.


What about a “Springing Power of Attorney?”


A springing power of attorney is a PoA agreement that only becomes active if you are incapacitated. The representative you name in the springing power of attorney agreement has no power or authority while you are mentally and physically able. A springing PoA may sound like the best of both worlds, but there are a couple of drawbacks. (1) The main point of a durable power of attorney is that your loved ones won’t have to go through the legal system to decide on your behalf. With a springing power of attorney, your loved ones may have to prove your incapacitation before getting access to your financials or making specific medical decisions;  requiring a signed report from a physician that then must be certified by the court. All this takes time and some money. (2) If you are considering a springing power of attorney, it may indicate that you don’t fully trust the individual you are appointing as your representative. If no other options exist, then it is a moot point.


Can I just pick and choose what authority to give my power of attorney representative?


You could, but you may run into trouble taking this approach. Durable power of attorney is designed with a broad approach in mind, whereas simple power of attorney fulfills one or two specific purposes, then ends. If you attempt to micromanage the authority given to your durable power of attorney, you may run the risk of blocking him or her from making a certain should you become incapacitated. It’s unrealistic from both time consumption and security standpoints to believe you can account for every financial or medical issue that could arise and include those individual clauses in your agreement. Choosing the right person is the most critical decision to make when appointing a durable power of attorney.


Are there any other ways to decrease malicious representative behavior?


Yes, you could assign another legal representative who acts as a watchdog over your primary representative’s actions and decisions. You can also appoint two individuals as durable power of attorney and require that they both agree on an action or decision.


Can I revoke a durable power of attorney?


Yes, as long as you have the mental and physical capacity to do so, you can revoke power of attorney at any time. However, for the revocation to be complete and legally binding, you must follow a process:


  1. Draft and sign a document stating that you revoke your durable power of attorney. At the very least, this document should note the date of the revocation and the representative’s name. You may have to get this document notarized;
  2. Present a copy of the revocation to your representative;
  3. Present a copy of the revocation to any institution that previously received a copy of the durable power of attorney, such as a bank that you and the representative use.
  4. Have the revocation recorded in the same place you had the durable PoA recorded.


Can I just print and fill out any durable power of attorney form?


You could, but remember, durable power of attorney gives nearly complete control of decisions and actions made in your stead. We highly suggest you seek an experienced family law and estate planning attorney’s guidance when designing and drafting a durable power of attorney agreement.


Illinois Powers Of Attorney FAQ | Financial Powers Of Attorney
Author

Attorney Kevin O'Flaherty

Kevin O’Flaherty is a graduate of the University of Iowa and Chicago-Kent College of Law. He has experience in litigation, estate planning, bankruptcy, real estate, and comprehensive business representation.

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