Planning Intermediate: Powers Of Attorney and Advance Medical Directives

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Which of the following is true regarding your power of attorney?

Its primary purpose in estate planning is to delegate broad authority over personal financial affairs to your agent in case you become disabled or incompetent

A comprehensive POA is an adequate substitute for a will in simple situations

Both of the above

None of the above

Its primary purpose in estate planning is to delegate broad authority over personal financial affairs to your agent in case you become disabled or incompetent. A POA becomes invalid at death and is not a substitute for a will.

Which of the following is true regarding durable powers of attorney?

Specificity in outlining your agent's authority is important

Most states have laws requiring financial institutions to honor properly executed powers of attorney

Both of the above

Neither of the above

Specificity in outlining your agent's authority is important. If that authority is unclear in the durable POA, whomever is asked to honor it could refuse.

An advantage of the durable power of attorney is that _______ .

It prevents your agent from taking advantage of his or her position

The law permits you to sign it even after you become totally incompetent

Unlike a springing POA, a durable POA takes effect immediately and avoids the burden of a formal determination of your disability.

Unlike a springing POA, a durable POA takes effect immediately and avoids the burden of a formal determination of your disability. The other statements are false.

Unless your power of attorney is "durable," your agent will not be authorized to act on your behalf if you become disabled.

True

False

True. That is the import of the word "durable."

Because of its importance and complexity, an advance medical directive is a document that is generally best left to be prepared by an attorney.

True

False

False. Most states have sample forms provided by law that can be obtained online.