Anybody who has met with me as a client comes away from the meeting with an understanding that a power of attorney can be the most important estate planning document in times of crisis.
When I sit down with clients and they tell me that they have a loved one entering a nursing home, one of the very first questions that I will ask them is "Do you have a power of attorney for your loved one?" If so, I instantly have a sense of relief insofar as the ability to protect the assets of a loved one is much easier because of the power of attorney document.
Often when a loved one is entering a nursing home, he or she will not have the mental or physical capability of executing important documents. The power of attorney eliminates this problem because the power of attorney document, if properly drafted, will allow the attorney-in-fact appointed by the power of attorney to take the necessary actions to protect the assets.
Many married couples feel that it is not necessary to have a power of attorney because "all of our assets are in both names." However, when we closely look at the assets of the couple, we quickly realize that many of the assets are not held jointly. For example, IRAs can only be owned by one spouse. Insurance policies, typically, are owned by just one spouse. Despite many years of marriage, a husband or wife does not have the ability to discuss accounts with the financial institution where the accounts are held.
Additionally, while it may be true that the residence of a couple is in both names, this does not give the husband or wife the ability to sign a deed on behalf of the spouse transferring the interest to themselves. Thus, the ability to protect the house if the institutionalized spouse cannot sign a deed because of a mental or physically incapacity can be severely hampered.
A proper power of attorney would allow the attorney-in-fact to take any and every step possible to protect a loved ones' assets in the event that they are going to have to enter a nursing home. This would include the ability to make unlimited gifts, and the ability to make gifts to the attorney-in-fact.
I cannot stress enough the importance of this document in the estate planning arena. If you do not have a power of attorney, please put this on the top of you "to-do" list.
Jeffrey J. Rokisky is an elder law attorney with offices in Wheeling, Weirton, Elkins, Clarksburg and Robinson Township. To submit a question for publication, email it to rrokisky@ rokiskylaw.com