A Power of Attorney (POA) is a very terribly serious document to issue, you also need to choose the most foremost applicable person to transfer power to. It is not an all-bad document it helps people that have their mental abilities compromised. In these cases, they look for someone they can trust and won’t try to abuse their power and have that person take care of financial and legal matters, which in turn makes life easier. Here you will be learning what power of attorney is and if a power of attorney can transfer cash to themselves or not. Don’t go and just continue reading, you will learn more. Let us know about “can a power of attorney transfer money to themselves?”.
Can a Power of Attorney Transfer Money to Themselves?
Even a general power of attorney has its limit. It’s a common rule that a power of attorney cannot transfer any personal property, real estate, money, or any other personal asset from the principal to him/herself. Most states if not all states have laws against this kind of act. It is commonly ruled as theft by fraud. The principal can impose these laws in criminal and civil courts and can have these transactions resolved. In cases where the principal is not available, unfit, legally incompetent, or unable to fight for their rights, third parties such as family members and potential heirs have the right to enforce the laws.
This rule also concerns transfers in the favor of the power of attorney’s interests. For instance, a POA cannot transfer the principal’s assets to a spouse or child. A court will see it as suspicious when a needless transfer from a power of attorney, most especially when the principal is not aware of the transfer or he/she is legally unfit. For instance, if you transferred the deed of a principal’s house to yourself then you sold it. The principal can declare the transfer and sale null and void. The agent will have to pay a refund and damages to the purchaser.
A power of attorney is a legal document that transfers one’s authority to assist in making business, financial, and any other legal choices from the principal to their agent. The principal is the person transferring power and the agent is the person collecting the power of attorney. It’s not only a business and legally binding decision the person makes for the principal but also making different choices on medical care, signing contracts, and other things. This kind of document is usually used when the principal is sick or has a disability that stops him/her from making these decisions and signing documents independently.
The agent can also access classified documents and the agent’s decisions will be viewed as if the principal is making them. Sometimes the power of Attorney is very limited to a specific activity with a specific area. For instance, when filing one’s taxes the IRS requires you to file them by yourselves no third party. In the event of having a power of attorney your agent files them as if you are doing them yourself.
Your agent can file them for you meaning the person has full access to your confidential IRS and your bank records, your agent also has a right to file the taxes for you. Therefore, the power of attorney is only limited to looking at your finances and filing your taxes with IRS and can’t beyond that like signing contracts in your name or selling your car.
Types of Power of Attorney
Well, here I will be highlighting the 4 main types of power of attorney that one can issues.
- General Power of Attorney
In this case, the agent will do something almost like the principal like accessing and managing personal finances. A general power of attorney can be terminated if the principal either dies, cancels the agreement, or is unfit.
- Durable Power of Attorney
This kind of situation comes from when a person takes action on the behalf of the principal. There is a durable clause put in that maintains the power of attorney when and after the principal becomes unfit.
- Special Power of Attorney
In this limited power of attorney, the agent will be having certain powers that will be limited to a certain area. For example, a power attorney allows an agent to sell out a piece of land or a piece of real estate.
- Springing Durable Power of Attorney
This is offered in some states. This occurs when a certain event happens and the principal is deemed unfit, the power of attorney will immediately be available and effective at that moment.
Conclusion
A power of attorney is not necessarily a bad thing but when considering you have to select the person that you can trust the most and your family should also have a say in the matter. So in the end there would be less fighting and quarreling both in and outside court.
Questions
- Can the power of attorney be paid for the work that they are doing?
Yes of course they can be paid but if the principal wants to pay the agent for it.
- For committing fraud, can the agent go to jail?
In some states, if the case is filed in criminal court, the agent has the potential of going to jail.
