A Limited Power of Attorney (LPOA) lets you designate another person to act on your behalf in certain legal, personal or financial matters.
This document is also called a Special Power of Attorney and is typically used for one specific purpose (like real estate closings) or routine business (like giving a portfolio manager access to your account).
What Is a Limited Power of Attorney?
A limited power of attorney is a document that authorizes your agent to act on your behalf only in the specific way(s) you indicate in the form.
What’s the difference between a POA and a Limited POA?
Both documents authorize an agent that you choose to handle your legal or financial affairs, but the main difference is the scope of the agent’s powers.
- A General Power of Attorney gives an agent broad powers over your affairs to act on your behalf and perform almost any legal action that you could do yourself (except what you specifically restrict them from doing in your instructions on the form).
- A Limited Power of Attorney, on the other hand, grants your agent authority to perform only the specific task or set of tasks on your behalf without giving them unlimited access to your personal affairs.
For instance, an LPOA can allow someone to cash checks for you and open your safety deposit box, but that agent wouldn’t be able to withdraw money or access your finances in any other way.
How long does a Special Power of Attorney last?
If you wish, you can set up your Special Power of Attorney to end at a certain date, after a certain event, or when the purpose of the document (if it’s created for a single task like selling a home) is completed.
In most states, if you don’t include an end date/event, the form will last until one of the following happens:
- the principal becomes incapacitated (if the POA is not durable)
- the principal revokes the power of attorney
- the principal or agent passes away
- the agent is unable or unwilling to perform their duties (and there’s no successor agent)
Make sure you check your state’s specific requirements before executing a power of attorney.
Why Would Someone Need a Limited Power of Attorney?
A Limited Power of Attorney gives your agent specific authority so they can complete certain tasks for you (such as signing a contract) but don’t have too much power over your affairs.
Here are some examples of circumstances in which the document may be useful:
- Aging or ill adults anticipating future challenges handling routine affairs like banking or mail
- Parents who need to assign a guardian for their children for a short period of time
- Businesses wishing to segment responsibility in separately structured POAs so that multiple people can carry out specific operational tasks
- Real estate transactions where a real estate agent can negotiate and make offers to buy or sell a property on behalf of their client
- Travelers away on an extended vacation or working abroad and wishing to appoint a trusted person to handle their basic financial matters during this time
- Investing where a financial manager can make trades or investments on someone’s behalf
- Tax preparation where a tax advisor can prepare and file taxes for someone
- Military personnel deployed overseas seeking to manage their affairs while away from home
You may also choose to create a special power of attorney form for any minor task that requires an agent to responsibly oversee your property, such as driving your car cross-country or building on your land.
How to Fill Out a Limited Power of Attorney Form
Once you’ve decided what specific powers you want to give your agent, you can begin filling out the form to legally grant those powers.
Before you begin, review the important information at the top of the form. This language describes what the form will and won’t do. If you don’t understand it completely, you should consult an attorney or other legal aid association.
Step 1: Designation of Agent
Write your name and address first, and then the name and address of the person you are choosing as your agent.
You can also nominate a second person to be your successor agent if the first person becomes unable or unwilling to serve as your agent.
Step 2: Grant of Authority
Here you should leave detailed instructions for what your agent may do on your behalf. Your agent will be limited to exactly what you write here and will not be able to do anything you do not list, so it is important to specify carefully.
Limitation on Agent’s Authority: This is a clause included in the form that prevents the agent from using your property unless you allow them to do so.
Step 3: Special Instructions (Optional)
If you have any special instructions, separate from the instructions previously given in the Grant of Authority section, you should list them here.
Step 4: Effective Date
Select one checkbox to indicate when the agent’s powers will take effect. This can be after a specific event, on a certain date, upon the principal’s disability or incapacity, or immediately when the document is signed.
Step 5: Termination
Indicate on the form when you want your agent’s powers to end.
A Durable Power of Attorney continues beyond any subsequent disability or incapacity, while a regular (also known as non-durable) is automatically canceled if the principal becomes incapacitated.
You may indicate in the Special Instructions that the Power of Attorney terminates upon completion of the task (for instance, if the agent is making a purchase); but you still must choose a termination for the document.
Step 6: Nomination of Guardian (Optional)
All powers of attorney provide for the nomination of a guardian to handle your affairs if you become incapacitated. Typically, this is unnecessary in a Special Power of Attorney, but if the grant of authority is for a long term or encompasses a great deal of authority, you might wish to consider it.
Step 7: Sign the Power of Attorney
The legal document must be signed by the principal. Depending on your state’s requirements, it may require one or two witness signatures and/or a notary acknowledgment.
If you’re unsure about anything, you should have the document reviewed by an attorney.
Limited Power of Attorney Sample
To get a fillable free form, download one of our templates (PDF & Word) and start drafting your Limited POA.
Limited Power of Attorney
Alternatively, you can use our document builder to create a complete, custom LPOA.
Does a Limited Power of Attorney Need to be Notarized?
Depending on where you live, a Limited Power of Attorney may or may not need to be notarized. Most states will require that someone (whether a witness, notary, or both) verifies the identity of the person signing, but you should research your state’s requirements before signing the document.
The Uniform Power of Attorney Act, which has been enacted by 29 states as of 2022, requires powers of attorney to be signed by the principal and acknowledged before a notary public to be legally binding.