What is a General Power of Attorney in Colorado?
A General Power of Attorney grants unlimited authority to the named agent to act on behalf of the principal. The General Power of Attorney in Colorado remains effective until it is either revoked or terminated. Unless the General Power of Attorney provides otherwise, the agent has broad powers to conduct at the principal’s discretion all matters affecting the property, and financial affairs of the principal.
Here are the most common Colorado powers:
The General Power of Attorney is quite common in personal life, professional, and legal settings . Many personal finance and estate planning experts have shown that it is vital to have a General and a Durable Power of Attorney prepared for each adult member of the family.
Under Colorado law, any person who is 18 years of age or older, or an emancipated minor, may be a principal and may delegate powers to an agent through the use of a General Power of Attorney. This document is a critical part of each adult’s overall estate planning program.
Components of the Form
In most cases, the purpose of a general power of attorney form is to give you, the Principal, authority to appoint someone by way of the form to act on your behalf for a broad range of decisions. The General Power of Attorney form is a legal document containing legal terms. This means that there are specific elements that either must be included or you may want to include additional elements to grant your agent the powers you want them to have under Colorado law.
The general power of attorney for financial matters form is going to be signed and notarized. It is important that the document be filled out properly and filed appropriately. These documents can often be revoked and the authority it grants can be terminated upon the death of the principal, unless you state otherwise in the document. The agent acting under a power of attorney has a legal duty to keep your interests as their main priority for actions taken under the power of attorney. This means that they cannot use the power of attorney to benefit themselves. Specific language must be used in the Colorado Power of Attorney statute giving your agent the authority to make gifts on your behalf. Specific language must be used to grant your agent the authority to place a lien on your homestead in Colorado. Specific language must be used to grant your agent the the power to make an anatomical gift on your behalf.
One of the key elements is to determine whether or not you as the principal will be requiring full or limited powers under the document you are executing. Generally speaking, you will be starting off with a general power of attorney form that will allow you to limit the powers that you are granting to your agent in the future. For example, you may have a general financial power of attorney now, but want to limit their powers in certain respects in the future. In that case, you may want specific language limiting their authority in the future, even when a general power of attorney has been created. In most cases, the general power of attorney forms have a paragraph spelling out that the general agent has the powers given to them under the law for taking financial, medical or estate planning decisions and life decisions. The applicable Colorado statute concerning the creation of a power of attorney (CO ST §15-14-501 et seq.) must specifically apply. The statute states in relevant part:
The decision-making powers given to the agent include the following:
a. right to make gifts;
b. right to waive the benefits of formulating and seeking the courts approval to seeing that a Guardian or Conservator be appointed for you if necessary.
You may want to include the following powers to the agent:
a. Right to Mortgage/Cross Mortgage Real Estate;
b. Right to Grant a Lien or Creation of a Security Agreement.
c. Right to change the disposition of property by will or codicil, which means at the time of death, you wish your assets to go to person who will manage them (Trust or not).
You want to talk with your lawyer about drafting a Colorado durable power of attorney that is appropriate for your financial, estate planning and medical needs.
How to Fill Out the General Power of Attorney Form
In Colorado, a general power of attorney form is a powerful document that appoints an agent to handle the principal’s financial matters. The following is a step-by-step look at how to complete a general power of attorney form in Colorado:
- Information About the "Principal"—The principal is the person completing the power of attorney. The form asks for the principal’s name and home address, along with any alternate or co-principal. Some forms request additional information, such as the date of birth and driver’s license number, so the principal should have this information ready to provide.
- Information About the "Agent"—The power of attorney form requires the principal to name the agent who will act on his or her behalf. The same information for the principal is required for the agent, including his or her name, home address, phone number, the date of the power of attorney’s execution, date of the principal’s birth, and driver’s license number.
- Agent’s Signature—The general power of attorney form will require that the agent sign in the appropriate place and print his or her name immediately underneath the signature.
- Attorney-in-Fact Certification—If the agent is not a fiduciary (such as a lawyer), the form will require that he or she sign a certification, swearing under penalty of perjury that the attorney-in-fact will not do any of the following:
—distribute any part of the principal’s assets to him or herself unless the distribution complies with the principal’s wishes and as permitted by law
—transfer any part of the principal’s property into the agent’s name unless the transfer is for the principal’s benefit
—engage in any transaction that involves property that is to be used by the principal without full compensation from the principal
5. Notarization—After you’ve signed the general power of attorney, the next step is to have the document notarized. Your financial institution may also have a notary public on staff, which can make the process much easier.
6. Copy Preparation—After the document is completed and notarized, it must be copied and distributed to the local county clerk and recorder and your financial institution. This is crucial because the original power of attorney only needs to be with the principal, but copies must be provided to any relevant parties—without copies, third parties may refuse to recognize the validity of the document.
Legal Restrictions and Responsibilities
The most common legal requirement for a general power of attorney form to be valid is that the principal must have voluntarily signed it while he or she still had the legal capacity to make medical and financial decisions. It must also be properly notarized. In Colorado, the general power of attorney form is normally valid until it is revoked in writing or the principal has been declared incompetent. Neither the principal nor the agent can change the form.
If you use a general POA form for your financial decisions, there are some limitations on the actions the agent can take. If you named the agent as your health care representative, he or she must also keep in mind your wishes in your advance medical directive. Similarly, if you signed a specific springing power of attorney document, the agent cannot use the general POA form during the time when you have not lost decision-making capacity.
A general POA form in Colorado is not valid when the principal has lost the legal capacity to make decisions. Your durable general power of attorney form is an exception. It remains valid, so long as the principal retains decision-making capabilities. If your agent holds legal responsibility for your assets, that role continues after your death. Your agent also has no authority to make decisions regarding your children. In the event that you become incapacitated and your general POA form is not in place, the court may step in and choose a guardian to handle your affairs.
Common Situations Involving a General Power of Attorney
There are several situations where an individual may need to have a general power of attorney. In Colorado, some of these can include:
1) An Active Duty Military Member
When a service member goes into active duty, they may want or need to execute a power of attorney to choose someone else to manage their financial affairs. This is because while he is deployed, he (the service member) may not be able to perform even the most basic of tasks related to their finances.
2) A Student
Majority age in the United States is 18 years old. When children who are at least 18 years old attend college, they may wish to execute a power of attorney to grant control of their financial matters to their parents.
3) An Incapacitated Parent
When a parent grows older, it may be difficult for the parents to handle their own financial matters. An adult child of elderly parents may wish to execute a power of attorney so that the child can step in and handle their parent’s finances.
4) An Incapacitated Heir or Beneficiary
It is important for the Court to have a "personal representative" for the estate of someone who has died (or who is incapacitated). A personal representative will come forward to manage the funds of a person who has passed away. The personal representative, when appointed by the Court, is then entitled to act on behalf of the incapacitated person or deceased person .
However, if this person is not present or is not able to act (such as in the case of an adult child) and another person (such as a sibling) wishes to act on behalf of the person who has died or is incapacitated, that person (who is not the personal representative) may require a power of attorney to allow them to do so.
5) An Incapacitated Business Partner
If a business partner becomes incapacitated and is unable to attend a required business meeting or sign documents relating to the business, the business partner who is capable may be required to have a power of attorney to act on behalf of their incapacitated partner.
6) An Incapacitated Trustee
A trustee of a trust can become incapacitated due to age or illness. During the time that the trustee is incapacitated, a new trustee will need to perform the duties of the incapacitated trustee.
7) An Incapacitated Civil Attorney in a Bond Handling
In the event that an attorney becomes incapacitated and their fees into an escrow account were not high enough to warrant the appointment of a conservator, a client or family member with a power of attorney may need to act on behalf of the incapacitated attorney.
8) An Incapacitated Conservator
Unlike a personal representative, a conservator does not require the approval of the court to be given the authority of their responsibilities. Because of this, a conservator may rely on a power of attorney to act and make decisions on behalf of an incapacitated person.
9) An Incapacitated Declarant
A declarant is the person that warrants a legal document to be valid. The declarant may be called on to testify in court on behalf of the person who has died or is incapacitated.
Revocation or Modification of a General Power of Attorney
A principal has the right to revoke a general power of attorney at any time. However, this does not necessarily prevent another person from having authority under the general power of attorney. The process to revoke or amend a Colorado general power of attorney form is as follows:
In order to completely revoke the prior Colorado general power of attorney form (designating a new agent), the principal must (1) execute a new general power of attorney designating a new agent or (2) provide the individual named in the prior instrument with a written notice of revocation of such instrument and his or her authority under it. An agent who has been formally revoked by the principal will no longer have the power to act on behalf of the principal.
If the principal wishes to keep the agent, but amend the general power of attorney form, the principal can do so if he or she communicates this to the agent. The principal can either express his or her intent to limit the agent’s authority (in which case the agent will only have the amended authority under the new Colorado general power of attorney) or else force the agent to conform its authority to the amendment of the Colorado general power of attorney. Failure to do so will put the agent at risk of exposing himself or herself to liability for unauthorized acts.
How to Get Legal Help in Colorado
If you’ve never made a general power of attorney before, chances are the details and terminology will sound completely foreign to you. Here are some tips for finding qualified legal professionals to help you create and understand this critical document .
Simply fill out a form for the document that needs to be drafted and your Colorado estate planning lawyer is there to help you with the rest. Can you make the mistake of doing it on your own? Absolutely, and that’s why you want an experience elder law attorney right by your side as you deal with important matters about your future.