Jul 20, 2021 New York Power of Attorney – Frequently Asked Questions

A power of attorney (POA) is a legal document that allows the creator of the document (called the “principal”) to designate or name an agent (known as the “attorney-in-fact “) to act for him or her with respect to financial matters.  This authority can be given immediately (a durable POA), or this authority can be made dependent on a future event, like the principal’s incapacity (i.e. a springing POA). A durable POA is much preferred, and is nearly always the POA of choice for reasons of convenience and practicality.

In New York, an agent designated in a durable POA can only act on the principal’s behalf after he or she signs the power of attorney in front of two adult witnesses, and a notary public.  The language included in the document must also meet certain statutory requirements.

An agent is usually a trusted friend or family member who will typically act only  in the event of an emergency, hospitalization, or unexpected illness, though he/she may act immediately upon the POA’s  execution (i.e., signing and notary attestation)

How Does a Power of Attorney (POA) Work?

The principal gives the agent the power or legal authority to make decisions on his or her behalf.

Some common responsibilities granted to an agent include:

• Access the principal’s financial accounts to pay for health care, utilities, rent or mortgage, and other bills;
• Filing the principal’s taxes;
• Making investment decisions for the principal;
• Collecting the principal’s debts;
• Managing the principal’s property; and
• Applying for state and federal government benefits on the principal’s behalf, like Medicaid, Veterans Benefits, Social Security, the Home Energy Assistance, and the Supplemental Nutrition Assistance Program (SNAP).

One of the most common reasons for a power of attorney in New York is to lend financial management assistance to a principal who is elderly, or when the principal is diagnosed with a serious, long-term health crisis.

If an agent uses his or her authority detailed in the POA, he or she must act according to the POA’s  instructions. The agent must at all times act in the principal’s best interest.

Can a New York Power of Attorney be Used in Other States?

Yes. A power of attorney is accepted in all states, but the rules and requirements differ from state to state. It’s best to seek the advice of an experienced estate planning attorney when considering the use of a New York power of attorney in another state.

Can I Revoke a Power of Attorney?

Yes. You can revoke your power of attorney at any time and for any reason, provided that you’re mentally competent. This revocation must be in writing, and you must inform banks and other institutions that may have relied on your power of attorney before you revoked it.

In addition, make certain that your agent gets written notice that you’ve revoked the agent’s authority.

Can I Contest a Power of Attorney in New York?

Yes. If the agent is acting improperly and not acting in the principal’s best interest, other family members can file a petition in court challenging the agent. If the judge agrees that the agent isn’t acting in the principal’s best interest, the judge can order that the power of attorney be revoked and that a guardian be appointed.

What Is a Special Power of Attorney?

A special power of attorney—also called a Limited Power of Attorney—is a legal document that authorizes an individual to act on behalf of the principal under specific circumstances that are stated in the POA. This can be limited to certain legal or financial decisions.

What is a POA-1?

A POA-1 is a power of attorney document that needs to be filed with the New York State Department of Taxation and Finance whereby the taxpayer designates an agent (e.g., an attorney or accountant) who is given the authority to obligate, bind, or appear on behalf of the taxpayer – an individual or business entity – in connection with tax matters administered by the New York State Department of Taxation and Finance, that include, but are not limited to:

• Personal income tax returns;
• New York’s real estate transfer tax, mortgage recording tax; or
•  withholding tax, sales and use tax, or motor fuel tax.

How Fast Are New York POA-1 Forms Processed?

Very quickly. If you submit your completed form online, the state will process your power of attorney within one business day. If submitted by fax, it takes two to three business days. And if the state receives your form by mail, it will be processed within seven to 10 business days.

Takeaway

A power of attorney protects your financial and legal interests, your health and well-being, and provides much needed support for you in the most difficult of times. If you become  incapacitated and don’t have a POA, you could add more anxiety, pain, and costs for your family in an already difficult time.

Remember that a power of attorney is a powerful document, and once you name an agent, that person may have the authority to act immediately on your behalf with or without your consent. To make sure your POA states exactly what you want, draft a legal and proper POA tailored to your needs with the help of an experienced estate planning attorney.

Contact Us

New York powers of attorney executed on or after June 13, 2021 that use a POA form that fails to comply with the requirements of the new law won’t be deemed valid and enforceable.

Ask the experienced estate planning and elder care attorneys at Ely J. Rosenzveig & Associates, PC to assist you with drafting your power of attorney, as well as other important estate planning documents, such as a health care proxy, living will, and last will & testament.

We are trusted estate, asset protection planning, Medicaid and elder law attorneys serving White Plains, New York, Westchester County, and the tri-state area.