A Texas durable power of attorney form appoints an agent to represent the principal’s financial interests. The agent’s decisions have the same legal weight as if the principal made them personally.
This designation remains effective until the principal’s demise or unless the principal specifically revokes it. The principal should select a trustworthy agent, such as a spouse, family member, or close friend, who can fulfill what’s best for the principal.
Laws
- Statute: Texas Estates Code §§ 751.001 — 751.251 and 752.001 — 752.115 (Durable Power of Attorney Act and Statutory Durable Power of Attorney).
- Presumed Durable: No, unless the principal creates the document in a state other than Texas that presumes durability (§ 751.0021(3)(A)).
- Signing Requirements: Signature required. Witnesses are not required (§ 751.0021(2)).
- Notarization: The signature of the principal must be completed in front of a notary public or other official authorized to take oaths (§ 751.0021(4)(A)).
- Statutory Form: Yes (§ 752.051).
Definitions
Durable Power of Attorney – Durable POA refers to a record, such as a written document, that complies with the requirements in § 751.0021 (§ 751.002(4)).
Specific Powers and Limitations
Restrictions on Gifts and Transfers
§ 751.032 highlights the restrictions on and considerations for gifts and transfers. If the principal’s document doesn’t state otherwise, this section’s rules will limit the agent’s power to give gifts.
Types of Gifts
- Gift for the benefit of a person: Making a gift for the benefit of a person can include contributing to a trust, any state’s qualified tuition program that meets the requirements of Section 529, Internal Revenue Code of 1986, or an account set up under the Texas Uniform Transfers to Minors Act.
- Outright gifts: Outright gifts from an agent to an individual can include any property belonging to the principal. The gift amount per person receiving the gift shouldn’t exceed the yearly amount permitted by the federal gift tax exclusion under Section 2503(b) of the Internal Revenue Code of 1986. The agent can double the limit of the yearly federal gift tax exclusion if the principal’s spouse consents to a joint gift.
- Consent to splitting gifts originating with the principal’s spouse: This consent lets the principal’s spouse divide gifts between several recipients, ensuring that each gift remains below the maximum amount for the aggregate annual gift tax exclusions for both the principal and the principal’s spouse.
Considerations
- The principal’s personal history of making or joining in making gifts.
- Factors in § 751.122, which include the following:
- Whether the principal qualifies for a benefit, program, or assistance under state law.
- The reduction of taxes, including income, inheritance, gift, estate, and generation-skipping transfer taxes.
- The principal’s future responsibilities.
- The value and nature of the principal’s property.
Agent’s Authority Limitations
If the principal grants an agent permission to perform all acts that the principal could perform themselves, the agent has the general authority that Subchapter C, Chapter 752 confers.
Otherwise, an agent can only exercise the authority that the document expressly grants them. No other instrument or agreement pertaining to the principal’s property should prohibit this authority (§ 751.031).
An agent who is not the principal’s spouse, descendant, or ancestry can’t exercise authority to create interest in the principal’s property for themselves or someone to whom they legally owe support. The document can state otherwise to avoid this regulation.
Safekeeping and Registration
If your DPOA deals with real estate matters, you should record it in the deed records of the country where the property resides. Otherwise, Texas doesn’t have a statewide registry or database for DPOAs. However, you and your agent should keep personal copies.
Depending on your preferences, you may store it in a financial institution, such as your bank.
How to Write
Step 1 – Download a Form
Texas has a statutory form, so ensure you download our template to access the appropriate information.
Step 2 – Review the Declaration Statement
Review the declaration statement marked as “NOTICE” at the top of the document. This document provides an overview of the powers you will grant to your appointed agent.
Step 3 – Name the Principal and Agent
Name yourself as the agent and identify the person you’re appointing as your agent. Provide your address and theirs. You can also designate a co-agent, but this step is optional.
Step 4 – Assign General Authority
Initial by all the general powers you grant, which appear as A through O underneath the section “General Grant of Authority.”
Step 5 – Grant Specific Authority
You may grant specific authority if you wish to define the powers more intricately. Only add your initials next to the powers you wish to grant.
Step 6 – Give Special Instructions
Give special instructions, such as if your agent is entitled to reimbursement for expenses they incur or compensation for the decisions they make for you. You can also assign special instructions to co-agents to clarify if they should work jointly.
Step 7 – Define the Effectiveness
State when the document will go into effect. Ideally, this will be immediately for a durable POA, and it will remain effective through your incapacity as the principal.
Step 8 – Designate a Successor Agent
Designate a successor agent so you’ll have someone to act on your behalf if your primary agent dies or becomes unavailable to act in your best interests.
Step 9 – Obtain Signatures
Obtain signatures from the principal and agent and have a notary public acknowledge the document.
Additional Resources
- Texas State Law Library: Provides resources on DPOAs.
- TexasLawHelp.org: Offers additional information on document creation and free and low-cost legal assistance.
