An Alabama durable statutory power of attorney form is a legal document that lets you name someone to make financial decisions for you if you cannot do so yourself. The person on whose behalf the decision is made is called the “principal,” and the person who agrees to act is called the “agent.”
This document is used for financial and business matters. In contrast, a health care POA is used for medical decisions, usually incorporated in a separate document called “Advance Directive for Health Care.”
Laws
All power of attorney forms in the state are durable by default unless it’s specified that they become invalid if the principal becomes incapacitated.
- Statute: Title 26, Chapter 1A (Uniform Power of Attorney Act).
- Presumed Durable: Yes (§ 26-1A-104).
- Signing Requirements: The principal’s signature is required; no witnesses (§ 26-1A-105).
- Notarization: The signature is presumed genuine if acknowledged before a notary public.
- Statutory Form: Yes (§ 26-1A-301).
Definitions
Durable – In a power of attorney, “durable” means not terminated despite the principal’s incapacity (§ 26-1A-102(2)).
Power of Attorney – “Power of attorney” means a document or record authorizing an agent to act on behalf of the principal, regardless of whether the term power of attorney is explicitly stated (§ 26-1A-102(7)).
Specific Powers and Limitations
Restrictions on Gifts and Transfers
According to Ala. Code § 26-1A-217, certain restrictions apply to the agent’s authority concerning gifts.
Types of Gifts:
- Gifts “for the benefit of” a person: This includes gifts to a trust, an account under the Uniform Transfers to Minors Act, and tuition savings accounts or prepaid tuition plans as defined under Internal Revenue Code Section 529.
- Outright gifts to individuals: The agent has the authority to make gifts of the principal’s property to individuals. The permissible amount for each is subject to the annual dollar limits of the federal gift tax exclusion under Internal Revenue Code Section 2503(b) or twice the annual federal gift tax exclusion limit if the principal’s spouse consents to a split gift pursuant to Internal Revenue Code Section 2513.
- Consent to splitting gifts made by the principal’s spouse: The agent can consent to the splitting of a gift made by the principal’s spouse, within certain limits defined by the aggregate annual gift tax exclusions for both spouses.
Considerations:
- Alignment with the principal’s objectives and best interest.
- The value and nature of the principal’s property.
- The principal’s foreseeable obligations and maintenance needs.
- The principal’s personal history of making or joining in making gifts.
- Tax minimization, including gift, estate, income, inheritance, and generation-skipping transfer.
- Eligibility for benefits or assistance.
Agent’s Authority Limitations
The agent’s limitations are outlined in Ala. Code § 26-1A-201 and are related to creating interests in the principal’s property.
An agent, unless an ancestor, spouse, or descendant of the principal, is restricted from creating an interest in the principal’s property for themselves or someone to whom they owe a legal obligation of support.
Revocation and Termination
According to Ala. Code § 26-1A-110, a DPOA ends when:
- The principal passes away.
- The principal revokes it.
- The document specifies its termination or its purpose is achieved.
- The principal revokes the agent’s authority or the agent dies, becomes incapacitated, or resigns, and another agent isn’t appointed.
- A court-appointed fiduciary revokes it.
The agent’s authority also ends when legal action is taken for the divorce, annulment, or legal separation of the agent and the principal (unless the POA states otherwise). This provision is applicable when the agent is also the spouse of the principal.
Other options to revoke a DPOA:
- Written revocation notice: Execute a written revocation, signed and dated by yourself or another person following your direction.
- Physical destruction: Obliterate, burn, tear, or otherwise destroy or deface the document in a manner indicating your intention to cancel it.
- Verbal revocation: Verbally express your intent to revoke the document in the presence of a witness over 19 years old, who then signs and dates a written document confirming your desire.
Executing a new DPOA doesn’t automatically revoke a previously granted one unless the new document explicitly revokes the earlier authorization or states the revocation of all other powers of attorney.
Safekeeping and Registration
While Alabama does not currently have a statewide registry specifically for DPOAs, you may explore the option of registering your document with county officials. Keep in mind that the registration requirements may vary by county, so it’s advisable to consult with county authorities to understand the specific procedures in your area.
Once you’ve executed your document, it’s crucial to store it in a secure and easily accessible location. Consider providing copies to trusted individuals, such as your attorney, family members, or the appointed agent, so that they can act swiftly when needed.
Additional Resources
- State Bar: Legal guides and resources for estate planning are available.
- Alabama Legal Help: It covers a wide range of online legal resources and tools to help individuals navigate legal issues, including powers of attorney.
