Do I Need a New Durable Power of Attorney?
Recent changes in the law in 2017 make it advisable to update your financial power of attorney. The Texas legislature has given estate planners additional tools that were not available previously.
The new statutes governing powers of attorney gives additional estate planning power to the agent. The law now expressly states that the principal (you) can give your agent the power to:
(1) create, amend, revoke, or terminate an inter vivos (living) trust,
(2) make gifts,
(3) create or change rights of survivorship,
(4) create or change a beneficiary designation (including a payable on death designation), and
(5) delegate authority granted under the durable power of attorney.
Previous case law had placed these powers in question as to whether they would be valid. Unless stated otherwise, the power to make a gift is limited to the principal’s ancestor, spouse, or descendants of the principal. These are the “hot powers” that are available to estate planners, but these powers do not appear in the standard statutory form. If drafted and signed properly, your power of attorney can include these additional powers.
Powers of attorney executed after September 1, 2017, also have expanded powers regarding mineral transactions, consenting to homestead liens, handling mail, providing for pets, and accessing digital assets.
When your agent needs to use a power of attorney, it is usually due to a life-changing circumstance such as a severe injury or a sudden illness. Most people want their agent to have broad powers so that the agent can make decisions and act as if they were the principal. Spouses should have powers of attorney for each other and at least one back-up person as the agent in case they are both in the same car accident. Without a power of attorney, for example, a spouse cannot sell a vehicle titled in the name of the incapacitated spouse. This is a good time to review your entire estate plan so that recent changes in the law can be incorporated.