Does a Power of Attorney Take Effect as Soon as You Set it Up?
A power of attorney (POA) is an important estate planning document. You may be wondering: Does a power of attorney take effect as soon as you set it up? The short answer is “it depends.” There are multiple different types of POA in New Jersey. It could, but does not have to, take effect right away. Within this blog post, our Monmouth County POA lawyer explains why a power of attorney takes effect in New Jersey.
Know the Law: Revised Durable Power of Attorney Act
A power of attorney is governed in New Jersey by the Revised Durable Power of Attorney Act (N.J.S.A. 46:2B-8.1 through 46:2B-8.13). Whether a POA takes effect immediately depends on how the document is drafted and the authority granted. New Jersey law gives you significant flexibility. It is important to know how to use it.
You Can Set Up an Immediate Power of Attorney Under New Jersey Law
An immediate power of attorney becomes effective as soon as it is properly executed. Under N.J.S.A. 46:2B-8.2, a POA is presumed to be durable and effective immediately unless the document expressly states otherwise. In other words, your POA is presumed to be immediate. You need to state otherwise in the document if that is not your goal. With an immediate POA, the agent can act even if the principal remains fully capable. Immediate authority is often used for convenience, such as allowing an agent to manage finances during travel or limited unavailability.
Springing Powers of Attorney (Incapacity)
For estate planning, most people do not want an immediate POA. A springing power of attorney is a better option. It does not take effect until a specific condition occurs, with the most being commonly incapacity. New Jersey law permits springing POA. However, the triggering event(s)must be clearly defined in the document. Many springing POAs require written certification by one or more physicians that the principal lacks capacity. Ambiguous triggering language can cause problems. A New Jersey estate planning lawyer can help.
Durable Powers of Attorney and Continuing Authority
Durability refers to whether the POA remains effective after incapacity, not when it begins. Under N.J.S.A. 46:2B-8.1, a POA is durable if it contains language showing intent to remain effective despite incapacity. Without that language, the POA terminates when the principal becomes incapacitated. Many people mistakenly assume all POAs are durable. In New Jersey, that assumption can leave families without legal authority at the worst possible time.
Call Our New Jersey POA Lawyer Today
At Poulos LoPiccolo PC, our New Jersey estate planning attorney has extensive experience handling POA issues. If you have any questions about setting up a POA, please do not hesitate to contact us today to set up a completely confidential, no obligation initial consultation. We provide estate planning services throughout all of New Jersey.
Source:
law.justia.com/codes/new-jersey/title-46/section-46-2b-8-2/
