A power of attorney allows a person to designate another adult to act on his or her behalf. The person who is designated to act is called the attorney-in-fact and the person designating the authority is called the principal. The attorney-in-fact must be an adult and have legal authority to enter into a contract.
The permission designated in a power of attorney can be granted for a specific, limited purpose and period of time or can be applied to broader purposes like all financial matters for a longer time period. It’s important to choose a trusted person as the attorney-in-fact because he or she has significant responsibilities. The attorney-in-fact also has a fiduciary duty, which means that he or she must act in the best interests of the principal.
Durable power of attorney
A durable power of attorney is used in the event the principal becomes incapacitated and cannot make decisions for him or herself. A regular durable power of attorney becomes effective when it is signed and notarized.
In Nevada, there is also a springing durable power of attorney that becomes effective on the day the principal becomes incapacitated. If the principal does not become incapacitated, the power of attorney does not become effective.
Both types of durable power of attorney documents allow the attorney-in-fact to make decisions about financial and property matters that the principal has specified.
It’s also important to note that while a power of attorney is an important part of an estate plan, it does not take the place of a will or trust. An experienced attorney can provide advice about power of attorney documents and other estate planning matters.