In Texas, a power of attorney (POA) is a formal document that allows you to designate another individual to act on your behalf in financial, legal, or medical matters. The person who designates the POA is called the principal, while the person who receives the authority is the agent (or attorney-in-fact).
POAs are a useful tool in planning for health emergencies, aging, or long-term illness; they enable a trusted individual to handle important tasks if you’re unavailable or incapacitated.
Power of Attorney Variants in Texas
Depending on how the document is written, a POA can take effect immediately, become effective at a future date, or stay in force until you revoke it or pass away. The following list describes the different POAs available in Texas:
- General Power of Attorney grants authority to manage financial affairs, such as opening or handling bank accounts, paying bills, buying or selling assets, signing contracts, and handling real estate transactions.
- Limited (Special) Power of Attorney provides authority for a specific purpose or for a limited time period. For example, you might authorize someone to sign a particular contract or oversee a real estate closing if you’re unavailable. The authority ends once the task is completed or the period expires.
- Durable Power of Attorney remains effective if you become unable to act due to mental or physical incapacity. This form is commonly used in long-term financial planning, allowing the agent to manage ongoing obligations such as mortgages, taxes, and other financial responsibilities.
- Springing Power of Attorney activates only when a defined event occurs, e.g., incapacity. Until that condition occurs, the agent does not have authority.
- Medical Power of Attorney specifically authorizes an agent to make health care decisions if you cannot communicate or understand your treatment options.
Many individuals utilize a combination of these POAs during their lifetimes and as part of their financial or estate planning process.
How to Create a Valid POA in Texas
To create a valid power of attorney in Texas, you must be at least 18 years old and of sound mind. You must also use a properly drafted POA form and sign it in the presence of required witnesses and/or a notary. Medical POAs typically involve witnesses or notarization and may include a medical or clinical affirmation, depending on the form used.
POAs that involve real estate transactions may need to be filed or recorded with the appropriate county clerk’s office.
The document should explicitly state what powers the principal is granting and whether they’re durable, springing, or limited.
What an Agent Can Do (and What They Must Avoid)
An agent may only exercise the powers listed in the POA and must follow the principal’s instructions. The agent’s actions must always align with the principal’s stated preferences and their fiduciary duty to act loyally and in good faith for the principal’s benefit.
Additionally, an agent cannot override the principal’s own decisions as long as the principal remains capable of acting independently.
How a POA Ends
A principal can revoke a POA at any time if they are competent. The POA generally terminates upon the principal’s death.
A non-durable POA ends at a stated expiration date or if the principal becomes incapacitated (depending on how it’s drafted).
Some powers terminate automatically after the completion of a particular task or upon the occurrence of a specified event.
Why a Power of Attorney Matters
A power of attorney ensures that someone you trust can manage important financial or medical matters if you are unavailable or unable to act. It can also help avoid the need for a court-appointed guardian, giving you greater control over who handles your affairs.
If you need help drafting a POA, Porter Law Firm can help. Contact us today to schedule a consultation to discuss your options.