A durable power of attorney is the document that allows you to appoint someone to financially act in your place if you are incapacitated. The person you choose will be given this authority as your agent. Being chosen as an agent under someone’s durable power of attorney is a big responsibility, but it does not have to be a burden.
Before accepting this position, you should understand what your responsibilities will be. Here are three examples of the roles an agent will serve in. We want you to know what you could potentially be called up to do before accepting the responsibility to be someone’s agent under their durable power of attorney.
1. When do your responsibilities start?
Once you sign the document designating yourself as the agent under the durable power of attorney, your responsibilities technically take effect. You are the person named to act for the principal if it is necessary. Most of your duties, however, only take place once the principal can no longer make decisions for him or herself.
2. What will your responsibilities be?
As an agent under a durable power of attorney, you are in charge of making a series of decisions should the principal be incapacitated. This can include being financially in charge of someone’s assets and involve bill payment, withdrawing funds, accepting deposits and investing, and paying taxes and submitting tax filings on time.  If you are an agent under an immediate power of attorney, these responsibilities take effect now.
One of the most important responsibilities is making decisions and acting on behalf of the principal. You cannot base decisions on your own beliefs. Instead, the decisions must be based on how the principal would make the decision if he or she were able to. If you are unable to make decisions on behalf of someone else’s wishes or your financial views conflict, you may want to reconsider becoming an agent.
When you are the agent, you should keep a record of your actions. Since you’re spending someone else’s money, other family members or friends, or even the court, may have questions on how the money is being spent. Being organized and responsible is a crucial part of being an agent. Â
If your involvement will be lengthy in time, or the transactions are complex, or if estate conflict is a concern, it might be a good idea to use a certified public accountant to assist. Courts, such as those in California, have certain specific formatting and other requirements for an accounting that are not intuitive. Â Using an experienced accountant to prepare these accountings in advance will save time and best protect you from any challenges to your actions.
3. Do you have liability?
You will be liable for the decisions you make. You need to act ethically and responsibly. It is perfectly acceptable for you to meet with your own attorney and possibly hire him or her to guide you through this process. In some cases, the power of attorney will allow you to use funds from the estate to pay for such counsel or professional help, so this cost might not have to come out of your own pocket. If you are uncomfortable with this aspect of the relationship, talk to the principal now about what he or she expects from you in this relationship.
Becoming an agent under someone’s durable power of attorney is a big responsibility. You need to prepare yourself for the responsibility which could start during a very stressful time. We often see children of aging parents overwhelmed by the sudden decline in a parent’s health also being asked to make critical decisions. Don’t wait to ask for help when you are named as an agent as this is a significant and serious role.
Want to learn more?
(1)  Register for a free workshop to hear more about what you need to know to protect what matters most. Â
(2)  Subscribe here to have more helpful tips and information sent directly to you.