Power of Attorney

Protect yourself by choosing your agent carefully

By M.N. Miller

As a small business owner, it’s important to have a written document called a power of attorney to protect yourself and your business. This legally binding document gives authority to an individual of your choosing to act on your behalf as your “agent.” The types of powers you would like to give to this agent determine what kind of power of attorney you will need.

General Power of Attorney

Gives broad powers to do many of the same duties that you yourself would do, including:

  • Writing checks
  • Paying bills
  • Borrowing money
  • Signing contracts in your name

Limited Power of Attorney

Restricts authority to the areas you specifically designate, including:

  • Buying or selling real estate
  • Accessing a specific bank account
  • Consenting to a treatment for you on your behalf (also known as medical power of attorney)
  • Other matters involving tax, insurance, financing and legal areas

In addition to the type of power of attorney you may select, it is also important to decide when you would like these terms to be in effect, as outlined below.

Non-Durable Power of Attorney

  • In effect during your lifetime, including when you are away or unavailable.
  • Becomes ineffectual if you become incapacitated.

Durable Power of Attorney

  • In effect during your lifetime, including when you are away or unavailable.
  • Continues to be effective when you are incapacitated.
  • Also called health care power of attorney.

Springing Power of Attorney

  • In effect only when a physician or another authority certifies that you are incapacitated or otherwise incapable of making decisions.
  • The authority and powers given to the individual you choose as your agent are considerable, so their selection should not be taken lightly. It is necessary to choose an individual you trust implicitly for this responsibility and they should be made aware of the importance of their role before they consent to signing the document.
  • Free power of attorney forms can be found online for download and printing. To ensure correct completion of the power of attorney document, it is advisable to seek the help of legal counsel.