A Power of Attorney (POA) is a key part of a solid estate plan. It is important to assign someone you trust as POA to make critical decisions on your behalf if you become incapacitated. While a POA is a legally binding document, it can also be revoked or changed if you desire.
Continue reading to learn more about POA procedures in New Jersey and the necessary steps to change the agent on your POA.
New Jersey Power of Attorney Guidelines
A POA is a powerful estate-planning tool that gives an individual (the principal) peace of mind knowing someone they name (the agent) will act on their behalf if they are unable to make sound decisions for any reason.
There are two types of POAs:
- Financial: Among other business and financial tasks, a financial POA gives the agent the right to open bank accounts, pay bills, and cash checks.
- Medical: a medical POA allows the agent to make healthcare decisions for the principal. In New Jersey, this document is referred to as a “proxy directive.”
Although POAs are important, they are relatively simple to create. In New Jersey, the principal must be of sound mind and understand their actions when they name a POA. Also, it must be signed in front of a notary public.
A copy of the signed and notarized POA should be filed with the county clerk’s office, and sent to the agent, and the attorney handling the principal’s estate planning matters. It is also wise to provide copies to your financial institutions and healthcare providers as well. Unless stated otherwise in the POA, the document takes effect immediately once it is signed and notarized.
When Life Brings Change, Be Sure to Update Your Estate Plan?
As your life situation changes, you may find the person you chose to be your agent is no longer who you want to make decisions for you. You might have a falling out, lose contact with your agent, or just decide someone else is better equipped to handle the responsibilities of POA.
You have the right to cancel (revoke) a POA or change the agent on your POA at any time, provided you are physically and mentally capable of doing so.
How to Choose the Right Person to Be Your POA?
Imagine that you become incapacitated due to age, illness, or injury. If you cannot manage your affairs or make decisions about your own medical care, someone must take over for you. You want that person to be someone your trust and someone who has your best interests in mind.
Nominating a POA can be difficult, particularly if you have a spouse, siblings, and children who all believe it should be them. POAs can be the source of family conflict, especially if loved ones do not agree on the decisions that impact you. Ultimately, the choice is yours and you need to do what is best for your own well-being.
Here are some things to consider when naming a medical or financial POA:
- Does the person share your values?
- Does the person understand your wishes?
- Does the person have the knowledge and experience to manage your affairs?
- Does the person have the time and will to fulfill the responsibilities of POA?
- Does the person demonstrate the integrity to manage your finances without taking advantage of your situation?
- Does the person understand and accept the rights and responsibilities of POA?
If the answer to any of these questions is “no,” you should continue the discussion or choose another person altogether.
How to Revoke and Change a POA?
If you want to change the agent on an existing POA and nominate another individual to fill that role, here are the steps you must take:
- Create a document in writing stating that you revoke your current POA.
- Notarize the statement.
- Notify the former agent that you are changing your POA.
- Prepare a new POA that names your new agent-of-choice.
- Provide copies of the revocation statement and new POA to all involved parties: your attorney, former POA, and all financial, business, and healthcare institutions that have your POA on file.
Do I Need a Lawyer to Remove Someone as Power of Attorney?
Yes. You should always hire a skilled lawyer for all your estate-planning matters. There are strict procedures and guidelines that must be followed to ensure your POA is legally-binding. Errors or oversights can render your POA and other estate-related documents invalid. That means the wishes you have for your estate and your family will not be carried out as you intend.
What if the Principal is Incapacitated?
We have discussed how someone of sound mind and body can revoke and update a POA, but the issue becomes more complex once the principal becomes incapacitated. The courts can remove an agent from a POA if they find that agent has acted against the principal’s best interests.
If you are an interested party with concerns about an agent representing a loved one, contact an estate lawyer right away. Before a judge will remove an agent, they review evidence including witness statements, financial records, and subpoenaed documents to look for evidence of on-compliance or misconduct.
If it is found the agent’s wrongful act harmed the estate, the judge can order a hearing where evidence from both sides is presented. If after the hearing, the judge finds there are grounds to remove the agent, the judge will do so and may surcharge the agent for damages. Legal counsel is critical to building a strong case to remove an agent to protect your loved one and their estate.
Plainfield Wills, Trusts, and Estates Lawyers at Herold Law, P.A., Secure Your Future
If you have just begun the estate-planning process or want to revise an existing plan, our experienced Plainfield wills, trusts, and estates lawyers at Herold Law, P.A. are here to help. With our guidance, you can create a solid estate plan to protect your interests and your family’s future. Call 908-647-1022 or inquire online to schedule an appointment today. We represent clients across Warren, Plainfield, and throughout New Jersey.