Sunday, January 15, 2006

legal representative (trust, guardianship, conservatorship, power-of-attorney, representative payee)

Sometimes older individuals become unable to handle their financial obligations because of either a physical or mental handicap. There are several ways to provide for this type of situation, including a trust, guardianship, power-of-attorney, or representative payee.
A simple trust can be drawn, naming a family member, friend, or bank as trustee. The older individual must be mentally competent for a trust to be drawn up, which means that trusts are suitable for individuals who have solely physical disabilities. Legal consultation is necessary to draw up a trust. Property transferred to the trustee is to be used for the care and protection of the individual. Upon the death of the individual, property is distributed as the trust instructs. A guardianship (conservatorship) may be appointed by the court if the individual is mentally incompetent and unable to designate a trustee. Generally, this is someone the family recommends or someone the court feels can serve best in this capacity. In many states, recent legislation has been passed to help protect the incompetent person. Efforts have been focused on requiring an annual accounting of financial worth, itemizing expenditures, and notification of hearings on guardianship petitions. Guardianship is a drastic legal step in which the incompetent person losses control of his or her property and income, the right to determine where to live, and what medical treatment he or she will receive. A guardian must obtain court approval, however, to remove the incompetent's voting privilege, to authorize experimental surgery, or terminate lifesaving medical treatment.
Power-of-attorney is authorization for someone to act on another's behalf. This can be issued for general or specific authority. Some lawyers advise against power-of-attorney because it is valid only as long as the individual is competent and alive. These states make provisions for guardianship. Other states recognize the power of attorney even if the individual becomes incompetent. Finally, a representative payee can be appointed. This is a person who serves as an agent in receiving and depositing Social Security checks. The representative payee must keep adequate records of transactions. The representative must apply for payee status at the local Social Security office.
Deedy, J. Your Aging Parents. Chicago: The Thomas More Press, 1984.
Gillies, J. A Guide to Caring for and Coping with Aging Parents. Nashville: Thomas Nelson Publishers, 1981.

0 Comments:

Post a Comment

<< Home