ESTATE PLANNING
Creating power of attorney documents
What does power of attorney mean, and why is it important to prepare power of attorney forms now?
The definition of power of attorney
The word “attorney” is often used in the vernacular to refer to a lawyer. However, attorney actually means “any personal representative.” A lawyer is technically an attorney-at-law: a personal representative in legal matters. Meanwhile, an attorney-in-fact is anyone legally empowered to represent someone else in other matters.
A power of attorney is the written document that grants representation by an attorney-in-fact. This document authorizes one person to personally represent—in other words, to legally act on behalf of—another person.
For instance, you or a loved one may at some point need to legally hand off decision-making power to someone else due to illness, travel, or for some other reason. In these cases, a power of attorney directive ensures this transition of power takes place under law. Without a power of attorney, you risk losing control over how your affairs are handled.
Call for legal service
Obtaining power of attorney in Denver, Colorado
Principals and Agents in Elder Law
There are two primary parties involved in power of attorney directives. First, the person creating the document is known as the principal. The person entrusted with decision-making power is known as the attorney-in-fact or the agent. Powers of attorney expire when the principal passes away or revokes the document during his or her lifetime. When the principal dies, an executor or trustee takes over managing this individual’s will, trust, and estate.
The State of Colorado in Elder Law
In the state of Colorado, when an individual needs decision-making help yet no one has been legally entrusted to represent him or her, Colorado law determines how finances and medical decisions are made. Sometimes, this means that family members or a court-appointed guardian will be asked to step in to help make decisions. However, these individuals may not be who the incapacitated individual would have selected. In other words, this power to make consequential decisions may pass to unknown individuals or institutions unless power of attorney forms are in order.
Situations that require having power of attorney documents ready
You may benefit from preparing your power of attorney documents if:
- you are traveling abroad, which may mean you will be out of direct contact with financial institutions.
- you are preparing for surgery or another medical treatment that may cause you to be incapacitated for more than a few hours.
- you want to be ready for the unexpected, whether a medical emergency or a change of life plans.
- you are simply ready to pass on some responsibility to others in your life.
If you want to ensure that you get to select who makes decisions for you should any of the above situations occur, you should prepare these documents well in advance. This way, you can be confident that someone trusted, usually a family member, will be able to help you make important decisions about your finances and medical care.
Call for legal service
Financial Types of Powers of Attorney in Colorado
An overview of financial types of power of attorney:
Statutory Durable Power of Attorney
A statutory durable power of attorney refers to a document authorizing by statute (law) a durable (long-lasting) power of attorney. In particular, this type of representation can begin before, and last after, an individual becomes incapacitated or unable to make decisions. Sometimes, this is called a general power of attorney.
Power of Attorney in the State of Colorado
Under Colorado law, a statutory durable power of attorney must be recognized by a third party (such as a bank) unless that third party has a “good faith” reason not to honor it. For instance, if a bank thinks that the agent is acting fraudulently or is pressuring you to hand over power, it may refuse to honor the power of attorney.
According to its Statutory Durable Power of Attorney Code and Contract, the State of Colorado recognizes a number of powers that may be granted or withheld, including:
- managing social security, Medicare, Medicaid, or VA benefits
- accessing a bank account
- buying or selling real estate
- making investment decisions
Partial Powers of Attorney and Grants of Specific Authority in the State of Colorado
Rights of the Agent
An agent may act on behalf of the individual who created the power of attorney document for all items specifically listed in it. These powers to act are called the rights of the agent.
Grants of Specific Authority
Under Colorado law, agents do not automatically have rights to certain powers that could fundamentally alter your estate. These hot powers—powers that could be used to alter the estate—must each be explicitly granted on the durable power of attorney form.
Examples of hot powers in the State of Colorado include:
- altering your beneficiaries
- authorizing a new agent to take over rights of the agent
- creating, changing or terminating a living trust
In order to authorize hot powers, you must individually initial next to each of these items, which are listed on the Colorado power of attorney form. If you entrust your agent with these hot powers, you can have granted what is called specific authority over these issues.
Power of Attorney for Medical Directives in Colorado
An overview of how to use power of attorney in medicine and healthcare
Above, we looked at the ways powers of attorney can impact financial decisions. Below, we will examine how healthcare directives can impact medical decisions.
Types of Medical Directives, Documents, and Forms
Medical Powers of Attorney and Health Care Directives
Appointing an Agent Using a Medical Power of Attorney Document
You can create a medical power of attorney directive by filling out a legal form that names someone you trust as an agent. This agent will then be able to make decisions about:
- medical treatments
- setting up at-home care or assistance for daily life activities
- ensuring safe placement in a nursing home or other senior community
Important to Note: Doctors cannot place you in a nursing home. However, they recommend what kind of care they think you need to the agent named in your medical power of attorney document. If you do not have a medical power of attorney document, Colorado law will turn to your spouse, your children, or occasionally Adult Protective Services to decide where you should be placed.
Link to form: Medical Power of Attorney from the Colorado State Government
Creating a Living Will (a Directive to Physicians)
A living will, more formally called a directive to physicians, gives you the opportunity to state ahead of time what kind of treatment and care you wish to receive if diagnosed with a terminal or irreversible condition.
For example, perhaps you have already named a loved one agent in a medical power of attorney document, but you don’t want to burden this person with making an end-of-life decision. A living will allows you to spell out exactly how you want a difficult moment handled in case it comes up.
Declaration for Mental Health Treatment
Under Colorado law, a declaration for mental health treatment allows an individual to specify or limit what kinds of psychoactive or anticonvulsant medications can be administered in case of a mental health condition. This advance directive will allow you to make decisions ahead of time about potential mental health issues.
Setting up HIPAA Authorization
The Health Insurance Portability and Accountability Act (HIPAA) ensures that your medical records are kept private. However, it is possible to authorize a list of people who can access your medical records and discuss your medical information directly with a health care provider. Doing so requires the creation of a HIPAA authorization form. A HIPAA authorization form doesn’t give anyone else the right to make medical decisions for you, but it does give named individuals some essential access to this information.
Declaration of Guardian Document
A declaration of guardian provides a general kind of safety net in case a court ever has to appoint a guardian on your behalf. It is meant to help the judge decide who should—and who should not—be appointed to make decisions for you. If you have preferences about who becomes your guardian in the event that you lose the ability to act on your own, this is an important form to fill out.
Do Not Resuscitate (DNR) Directives
There are two kinds of DNR directives to know about: in-hospital and out-of-hospital. Both types are requests by a patient not to be resuscitated in the case of cardiopulmonary failure. An in-hospital DNR will be added to a patient’s medical file by a physician.
Disposition of Remains
Creating a disposition of remains document allows you to clearly state who may dispose of your remains in the event of death. This document can also state burial or cremation preferences to be followed by the agent named in the document. A disposition of remains document must be signed by both parties to ensure that the agent named accepts this end-of-life responsibility.
Call us For an Appointment
Please contact us by phone during business hours if you would like us to schedule a time to review your estate planning documents.
Call Us
Email us
Visit us