Typically, a power of attorney (POA) is not named for a trust. Nevertheless, there could be circumstances when you might want to designate the same individual as your trustee and as your attorney in fact.
A POA is legal documentation that provides someone other than you the authorization to act on your behalf. A trust, however, is supervised by a trustee.
If you’re worried about safeguarding your assets and yourself throughout your lifetime if you become debilitated, it’s important to have each of these kinds of documents.
A living trust is devised during an individual’s lifetime. It enables the beneficiaries that you designate to acquire your assets quickly devoid of an executor going to go to court to probate it, different from a will. When its devised, you’ll have to decide on an individual that is going to supervise the assets on your behalf. Don’t forget that you on your own can also act as the trustee if you decide to. You then going to have to fund it by the transfer of your assets out of your name and into the account. Following you’ve finished the transfer in title, the trust then takes ownership of those assets.
One of the most general kinds is a revocable living trust, since you can modify it at any time you want. In addition, you can include, take out, or even terminated it entirely. Irrevocable trusts, nevertheless, are unable to be modified or revoked at any time.
Power of Attorney
A power of attorney is a contrasting kind of legal protection you can devise at any time. Some are only for specific reason. Using this document, you can authorize an individual to act on your behalf straightaway or down the road. The individual creating the document is the principal, and the 3rd party provided with the authority is known as the agent.
Power of Attorney Duties
Giving an individual general power of attorney allows an agent to carry out a variety of functions, like the selling of your property, the filing of your taxes, and conducting financial institution transactions. Limited power of attorney, on the other hand, enables the agent to act only in specific cases included in the document. In other words, if you want your agent to manage your finances for a month while you’re abroad, you’ll provide them with limited authority by providing them to access your financial institution accounts only throughout that month.
With a durable power of attorney, your agent remains to have the authority to act even if you become debilitated. It doesn’t matter what kind of authority you decide to provide them with, it is going to end once you pass away.
Having a POA for a Trust
There are occasions when you are going want both of them. You need to give an individual authority under each of them when you want them to:
- Act for you in a way other than just overseeing the trust, such as managing your finances. Then, they have additional powers provided to them in your POA document.
- Supervise property not in your trust. This enables them to add further assets into it if you have not put them in yourself or when you acquired the assets prior to its creation.
- File your taxes on your behalf. They are unable to do this without a POA enabling them to do so.
- Modify the trust someday should you become mentally or physically debilitated. This could include terminating it should you need money from your assets in emergency situations.
Sometimes these estate planning devices occur simultaneously, while the trust provides for your beneficiaries following your passing, your POA covers additional requirements throughout your lifetime. Occasionally this is the same individual. Make sure to safeguard yourself throughout and following your lifetime by guaranteeing that you have someone that you can trust to oversee your health care and financial affairs.
DeLoe, R. (2018, November 6). What is a power of attorney for a Trust? LegalZoom. Retrieved January 19, 2022, from https://info.legalzoom.com/article/what-power-attorney-trust
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