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Durable Power of Attorney
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Definition
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Written document executed by the principal empowering a person to handle the
principal's affairs.
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When Does It Apply?
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Where a person may become disabled or wants management of his or her assets.
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How Does It Operate?
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Individual of legal age and competence gives another of legal age and
competence the power to manage assets and/or affairs. This power may be very
broad or limited.
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Advantages/Disadvantages
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Advantages - can substitute for a revocable trust or legal guardianship
or conservatorship; can be designed to take effect now or upon the occurrence
of a future event (i.e. disability).
Disadvantages - none.
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Estate/Gift Tax Implications
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Property is included in principal's estate.
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Income Tax Implications
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Income produced by assets is taxed to principal.
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Other Considerations
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This power is not terminated by disability or incapacity of the principal
subsequent to its execution.
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