What You Actually Do to Become a Power of Attorney
Becoming a power of attorney means the person who grants you the power (called the principal) signs a legal document that names you as their agent. You do not go to court, file paperwork with the government, or take a test. The principal writes or has a lawyer write a power of attorney document, signs it in front of a notary public, and gives you a copy. That is the entire process. You become a power of attorney the moment they sign.
The document itself is what makes it official. Different states have different forms and rules about how the document must be signed and witnessed, but the basic step is always the same: the principal signs a piece of paper that says you can act on their behalf. Some states require a notary signature. Some require two witnesses. A few require both. You need to know your state's rules before the principal signs, because a document signed the wrong way may not be accepted by banks or other institutions.
You do not need the principal's permission to use the power of attorney once you have it — the document itself is your permission. However, you are legally bound to act in their best interest, not your own. If you misuse the power, you can be sued or prosecuted for fraud or theft.
Key Takeaways
- The principal (the person granting power) must sign a power of attorney document in front of a notary public; you do not file anything or go to court.
- Your state's rules determine whether the document needs one or two witnesses, a notary signature, or both — using the wrong format can make the document invalid.
- You become a power of attorney the moment the principal signs the document; there is no waiting period or approval process.
- You are legally required to act in the principal's best interest, and misusing the power can result in criminal charges or a lawsuit.
- Different types of power of attorney (general, limited, durable, springing) give you different powers and last for different lengths of time.
Choosing What Type of Power of Attorney to Use
The principal decides what type of power of attorney to create, and that choice determines what you can and cannot do. A general power of attorney gives you broad authority to handle finances, property, and legal matters — essentially everything the principal could do themselves. A limited power of attorney restricts you to specific tasks, like selling one piece of property or managing a bank account. A durable power of attorney stays in effect even if the principal becomes mentally incapacitated; a regular power of attorney ends if they do. A springing power of attorney does not take effect until a specific event happens, usually the principal's incapacity.
The principal should choose the type based on what they actually need you to do. If they want you to handle everything because they are traveling or ill, a general durable power of attorney makes sense. If they only want you to sell their house, a limited power of attorney is safer for both of you because it prevents you from accessing their bank accounts or making other decisions. The document itself spells out exactly what you can do, so anyone you deal with (a bank, a real estate agent, a court) will read it and know your limits.
Getting the Document Signed and Notarized
The principal can use a form from their state's bar association, a template from an online legal service, or hire a lawyer to draft a custom document. State bar associations often provide free or low-cost forms on their websites. Online services like LegalZoom or Nolo sell templates for $50 to $150. A lawyer typically charges $200 to $500 to draft a power of attorney, though costs vary by location and complexity.
Once the document is ready, the principal must sign it in front of a notary public. A notary is available at most banks, UPS stores, and some pharmacies — the cost is usually $5 to $15 per signature. Some states require one or two witnesses to be present as well. The witnesses cannot be you, the principal's spouse, or anyone who stands to inherit from the principal. After everyone signs and the notary stamps the document, it is complete.
The principal should keep the original signed document in a safe place and give you a certified copy. Some institutions will only accept a certified copy, which you can get from the notary or a lawyer for a small fee. Keep your copy somewhere accessible but find — you will need to show it to banks, insurance companies, and other organizations when you act on the principal's behalf.
What Happens When You Use the Power of Attorney
When you need to act as power of attorney, you show the document to the institution or person you are dealing with. A bank will photocopy it and keep it on file. A real estate agent will review it to confirm you have the authority to sell the property. A court may require you to file it as part of a legal case. You do not need to register the power of attorney with any government office unless your state specifically requires it for real estate transactions — check your state's rules.
Some institutions will ask you to sign their own power of attorney form instead of accepting the principal's document. This is common with banks and investment firms. You can usually negotiate, but if the institution refuses to work with the original document, you may have to sign their version. Read it carefully to make sure it does not give you more power than the principal intended.
You must keep records of everything you do with the principal's money or property. Banks will provide statements. For other transactions, save receipts, contracts, and correspondence. If the principal ever questions what you did, or if their family disputes your actions after their death, these records protect you by showing you acted appropriately.
When the Power of Attorney Ends
A regular power of attorney ends when the principal dies or revokes it. A durable power of attorney continues after the principal becomes incapacitated but still ends at death. When the principal dies, their will and estate take over — you no longer have authority to act on their behalf unless you are named as executor of their will. If the principal revokes the power of attorney, they must notify you and any institutions that have a copy of the document.
After the principal dies, return the original power of attorney document to their estate or family, and do not use it again. Using a power of attorney after the principal's death is fraud, even if you are acting with good intentions. If you need to settle their affairs, you will do so as executor of their will or as a beneficiary, not as power of attorney.
Your Legal Responsibilities as Power of Attorney
The law requires you to act in the principal's best interest, not your own. This means you cannot take their money, give yourself gifts from their accounts, or make decisions that benefit you at their expense. You must keep the principal's money separate from your own, use their funds only for their benefit, and avoid conflicts of interest. If you are tempted to use their money for yourself, do not — the principal, their family, or a court can sue you for breach of fiduciary duty, and you may face criminal charges for theft or fraud.
You should also keep the principal informed about what you are doing with their money and property, unless they have become incapacitated and cannot understand. If they ask for an accounting of your actions, you must provide one. Some states require you to file an annual accounting with the court if the principal is incapacitated. Check your state's rules or ask a lawyer if you are unsure what you owe the principal.
If you make a mistake — for example, you accidentally overdraw an account or sign a contract with unfavorable terms — you are not automatically liable as long as you acted reasonably and in good faith. However, if you act recklessly or ignore the principal's instructions, you can be held responsible for the loss. This is why it is important to understand the limits of your power and ask for legal information if you are unsure whether a particular action is allowed.
When You Should Hire a Lawyer
You do not need a lawyer to become a power of attorney, but you may need one to use the power correctly. If the principal's finances are complex — they own a business, have multiple properties, or have significant investments — a lawyer can advise you on how to manage those assets without breaking the law. If a bank or other institution refuses to accept the power of attorney document, a lawyer can help you resolve the dispute. If family members challenge your authority or question your decisions, a lawyer can defend you.
The cost of legal information varies. A lawyer might charge $150 to $300 per hour for consultation, or a flat fee of $500 to $1,500 for handling a specific task like selling property or managing an estate. Some lawyers offer free initial consultations. If the principal's estate is large enough, the cost of legal information is usually worth it to avoid mistakes that could be much more expensive to fix later.
Frequently Asked Questions
Can I become a power of attorney without the principal's knowledge?
No. The principal must sign the power of attorney document themselves, or in some cases a court can appoint you as a conservator or guardian if the principal is incapacitated and cannot sign. A power of attorney signed without the principal's knowledge is forged and is a crime.
Do I need to be a family member to be a power of attorney?
No. The principal can name anyone they trust — a friend, a professional advisor, or a corporate fiduciary like a bank. The principal decides who has the power, not the law.
What if the principal changes their mind and wants someone else to be power of attorney?
The principal can revoke the power of attorney at any time by signing a revocation document and notifying you and any institutions that have a copy. They can then create a new power of attorney naming someone else. The new document takes effect when ready.
Can I be power of attorney for more than one person?
Yes. You can hold a power of attorney for your parent, your spouse, and a friend all at the same time. Each power of attorney is a separate document with its own limits and rules. Keep them organized so you do not confuse one person's accounts with another's.
What happens if I die while I am someone's power of attorney?
Your authority ends when ready. The principal will need to name a new power of attorney, or if they are incapacitated, their family may need to go to court to appoint a conservator or guardian. This is why it is a good idea for the principal to name a backup power of attorney in the original document.