Differences Between Your Power of Attorney and Personal Representative
Apr 28, 2022
Even though some of the responsibilities of your Power of Attorney and your Personal Representative seem similar, legally, they are very different. Simply put, the difference between the two is life and death. A Power of Attorney can be appointed and only has authority while you are alive. A Personal Representative can only be appointed and have authority after death. Let’s discuss how they are appointed, when they go into effect and the responsibilities of each role.
APPOINTMENT OF YOUR POWER OF ATTORNEY
Properly executing a Power of Attorney appoints a person of your choosing, known as an agent, to act as your Power of Attorney. When your Power of Attorney goes into effect depends on how it is written. It can be effective immediately unless you state a future occurrence that will activate it, such as if you become incapacitated or incompetent.
RESPONSIBILITIES OF YOUR POWER OF ATTORNEY
The agent appointed as your Power of Attorney has the authority to make healthcare and financial decisions during your lifetime. In the State of Wisconsin, there are two different types of Power of Attorneys. A Power of Attorney for Healthcare and a Power of Attorney for Finances.
Power of Attorney for Healthcare
The Power of Attorney for Healthcare allows you to appoint a person to make healthcare decisions for you. The decisions can be as simple as whether you receive medication or as complex as whether you receive a high-risk surgery. Your Power of Attorney can review your Living Will, also known as your Declaration to Physicians, to know what life sustaining treatments you do and do not want.
Power of Attorney for Finances
The Power of Attorney for Finances allows you to appoint a person to handle your finances. You can choose which powers the person you appoint is able to handle, including but not limited to, real estate, bank accounts, retirement plans, insurance and annuities, government benefits, operation of business and taxes.
A Power of Attorney is no longer valid after death. After you pass away, the only person able to act on behalf of your estate is your Personal Representative.
APPOINTMENT OF YOUR PERSONAL REPRESENTATIVE
Your Personal Representative’s role can only start after you pass away, but they are not automatically appointed at the time of your death. The probate court must appoint your Personal Representative and give them the authority to act on behalf of your estate. You can choose who is appointed as your Personal Representative in your Last Will and Testament; otherwise, the probate court will choose someone on your behalf.
RESPONSIBILITIES OF YOUR PERSONAL REPRESENTATIVE
Once the probate court appoints your Personal Representative, they have the authority to act on behalf of your estate. The Personal Representative’s responsibilities will vary with each estate, but commonly they will include the following:
Locating Will if one was drafted
Obtaining Death Certificates
Identifying and locating assets
Deciding whether to hire an attorney to handle probate
Maintaining finances and financial records
Managing assets and distributing assets
Please note that not all estates have to go through the probate process. In the State of Wisconsin, estates under $50,000 can avoid the probate process. An experienced attorney can help determine whether an estate will need to go through the probate process.
Estate planning can provide peace of mind when it is understood and done properly. Understanding the roles and responsibilities of your Power of Attorney and Personal Representative ensure that you appoint the correct person to act on your behalf. Pedersen Law Office, LLC offers free consults to discuss your personal circumstances, answer your questions and help you make the best choices for you and your family’s future.