A South Dakota durable power of attorney form lets a principal appoint a trusted agent to manage their financial matters. Because this form remains effective through the principal’s incapacity, they must choose a trusted agent and grant them appropriate control.
Laws
- Statute: §§ 59-1-1 through 59-12-43.
- Presumed Durable: No (§ 59-7-2.1).
- Signing Requirements: The principal must sign.
- Notarization: A notary public must acknowledge the principal’s signature (§ 59-12-4).
- Statutory Form: Yes (§ 59-12-41).
Definitions
Durable – “Durable” means not terminated by the principal’s inability to make decisions for themself (§ 59-12-1(2)).
Power of Attorney – “Power of attorney” refers to a written document appointing an agent to make decisions on the principal’s behalf. It remains relevant even if the document doesn’t explicitly use the term (§ 59-12-1(7)).
Specific Powers and Limitations
Restrictions on Gifts and Transfers
§ 59-12-39 outlines the types of gifts and considerations for agent gift-giving:
Types of Gifts
- Gift “for the benefit of” an individual: This gift includes any contributions an agent makes to a trust. It also encompasses the money they put in an account under the Uniform Transfers to Minors Act, a prepaid tuition plan, and a 529 education savings account.
- Outright gifts to individuals: An agent can make gifts outright to a person of any of the principal’s property up to the annual dollar limits of the federal gift tax exclusion.
- Consent to split gifts: An agent can approve the splitting of gifts made by the principal’s spouse. This way, each gift to a donee counts as half from each spouse. This strategy doubles the allowable exclusion limit per donee to the combined annual gift tax exclusions of both spouses.
Considerations
- How the principal has made and jointly made gifts in the past
- Whether the principal qualifies for assistance, a program, or a benefit under a regulation or statute
- The minimization of taxes, including gift, generation-skipping transfer, inheritance, estate, and income taxes
- The value and nature of the principal’s property
- The principal’s future commitments and maintenance needs
Agent’s Authority Limitations
According to § 59-12-23(3), if a power of attorney concurs authority to an agent to do all acts a principal could do, the agent has the general authority outlined in §§ 59-12-26 through 59-12-38. Please note that this authority is subject to subdivisions (1), (2), (4), and (5) of § 59-12-23.
Unless the DPOA states otherwise, an agent who isn’t a spouse, ancestor, or descendant of the principal won’t be able to exercise authority to benefit themselves or someone they must provide with legal support.
Safekeeping and Registration
South Dakota doesn’t have a statewide registry. However, the principal may need to register their document with their local register of deeds (land records office) if the form grants authority relating to real estate.
Otherwise, the principal and the agent should store this document in a secure place, such as a safe in their home, so they can reference it as necessary.
Additional Resources
- SD Law Help: Provides specific information on durable POAs.
- State Bar of South Dakota: Offers links to free and low-cost help from organizations like Dakota Plains Legal Services and SD Free Legal Answers.
