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What is the purpose of a Power of Attorney form?

A Power of Attorney (POA) form is a legal document that lets one person (the principal) authorize another person (the agent or attorney-in-fact) to act on their behalf in financial, legal, or medical matters.*

Core purpose

The purpose of a POA is to ensure someone you trust can legally make decisions for you when:

  • You’re unavailable (traveling, deployed, busy)

  • You’re temporarily incapacitated

  • You become permanently incapacitated

  • You want help managing complex affairs

What a POA can cover

Depending on how it’s written, a POA can give authority to:

  • Pay bills and manage bank accounts

  • Buy or sell property

  • Handle investments or business matters

  • File taxes and deal with the IRS

  • Make healthcare decisions (with a healthcare POA)

Common types of Power of Attorney

  • General POA – Broad authority over finances and legal matters

  • Limited (or Special) POA – Authority for specific tasks or time periods

  • Durable POA – Remains effective if you become incapacitated

  • Springing POA – Takes effect only when a defined event occurs (often incapacity)

  • Healthcare POA – Authorizes medical decisions

Why it matters

Without a POA:

  • Family members may not automatically have authority to act for you

  • Courts may need to appoint a guardian or conservator

  • Decisions can be delayed, costly, and stressful

Important notes

  • A POA ends at death (then a will or trust takes over)

  • You can revoke it at any time while competent

  • Laws vary by state, so proper drafting and notarization matter

POAs are a foundational document alongside a will or trust—they enable continuity while you’re alive, whereas a will governs what happens after death.

See also article titled: "What types of estate planning documents can I create in Covet?"

*Covet does not provide any legal, investment, accounting, financial, and/or tax advice. The Covet site includes access to software and self-help materials, which are not substitutes for the advice of an attorney, financial advisor and/or accountant.