The Texas Power of Attorney Act, which is contained in Chapter 7 of the Texas Probate Code,[1] allows a resident to transfer financial and health care decision-making powers to another individual. Powers of attorney are very useful for anyone to have in place, no matter what one's age might be. The reality is that events can occur suddenly that make an individual unable to make certain decisions on their own. A power of attorney allows another person, who has been chosen in advance by the individual, to make those decisions for them.
A growing area of concern involves medical identity theft, which gives thieves the ability to access prescription drugs and even expensive medical treatments using someone else’s identity. When successful, medical identity theft frequently results in erroneous entries being put into the victim’s medical records, which in turn may even lead to inappropriate and potentially life-threatening decisions by medical staff.
Fill out your forms. You will need to fill out your power of attorney forms completely. It is advised that you have your agent, or the person whom you are granting the powers, present when you decide to fill it out. You also can have your attorney draft the forms for you. If using the statutory form, you will need to affirmatively initial each of the individual powers that you wish your agent to have. Here is the other information that you will need to provide on the forms:
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Decide what type of power of attorney is right for you. There are different types of powers of attorney that you may want to execute, depending on your situation. Some cover only financial issues, whereas others address health care issues.[2] These powers of attorney can either become effective immediately, or on a future date, when you are unable to make decisions on your own behalf, due to disability, illness, or injury. The state of Texas has established a Statutory Durable Power of Attorney law[3] that allows you to choose the type of power of attorney that best accomplishes your goals.
If you're looking to create a living will in a cost-effective way, you could download a free living will form from a source that you trust, such as RocketLawyer.com or LawDepot.com, or get a form at your local hospital and have it notarized at your bank for around $10 or $15. These templates are often comprehensive and provide space for you to list the names of your physicians as well as emergency contact numbers. These forms also address specific situations, such as pregnancy; on the form, you can specify your wishes for medical care in the event you become incapacitated.
A power of attorney terminates if the principal becomes incapacitated, unless it is a special kind of power of attorney known as a “durable power of attorney.” A durable power of attorney remains effective even if a person becomes incapacitated. However, there are certain exceptions specified in Florida law when a durable power of attorney may not be used for an incapacitated principal. A durable power of attorney must contain special wording that provides the power survives the incapacity of the principal. Most powers of attorney granted today are durable.
Third parties are often concerned whether the document is valid. They do not know if it was executed properly or forged. They do not know if it has been revoked. They do not know if the principal was competent at the time the power of attorney was signed. They do not know whether the principal has died. Third parties do not want liability for the improper use of the document. Some third parties refuse to honor powers of attorney because they believe they are protecting the principal from possible unscrupulous conduct. If your power of attorney is refused, talk to your attorney.
Schemes to commit identity theft or fraud may also involve violations of other statutes such as identification fraud (18 U.S.C. § 1028), credit card fraud (18 U.S.C. § 1029), computer fraud (18 U.S.C. § 1030), mail fraud (18 U.S.C. § 1341), wire fraud (18 U.S.C. § 1343), or financial institution fraud (18 U.S.C. § 1344). Each of these federal offenses are felonies that carry substantial penalties –¬ in some cases, as high as 30 years' imprisonment, fines, and criminal forfeiture.
However, many accounts, such as bank savings, CD accounts, and individual brokerage accounts, are unnecessarily probated every day. If you hold these accounts, they can be set up—or amended—to have a transfer on death (TOD) designation, which lets beneficiaries receive assets without going through the probate process. Contact your custodian or bank to set this up on your accounts.
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