Hi, Dan Krause here, and I want to talk about the Wisconsin Statutory Power of Attorney.
I'm from Krause Estate Planning & Elder Law Center. We help elders and their loved ones preserve their life savings in the face of nursing home or other long-term care expenses.
So, powers of attorney are a very important part of every estate plan. Everyone who is an adult should have a financial power of attorney, along with a healthcare power of attorney and many other documents. But I want to focus on the financial power of attorney.
Now the Wisconsin legislature several years ago, created a statutory power of attorney that anybody can download and use. You download it, you initial in the boxes that you want, the powers that you want your agent to have, then you sign, and have it notarized.
And that is a perfectly valid Wisconsin power of attorney. In fact, it will work in any state as long as you properly fill it out in Wisconsin. It doesn't cost anything, and it works!
The problem with it: It doesn't cover every situation.
Now, even though the power of attorney says there's a place you can initial that says "my agent can do anything that I can do."
And in our mind, it's logical that they can do anything that I can do. But they can't unfortunately.
Because the power of attorney doesn't specifically allow for gifting. Now why is that a problem?
If I have a power of attorney agent, would I want them to give my stuff away? Well, no, it doesn't make sense - except in the case of end-of-life planning.
Now, a lot of times, when we have a client who is facing the devastating cost of nursing care or assisted living care, they want to preserve for their family as much of their assets as they can. Part of the way to preserve the maximum amount of assets for your family is to gift some of your assets to your family or to gift them to an irrevocable trust. This would not be allowed in the general statutory power of attorney in the way that it is written and made out.
That's one of the reasons why the power of attorney that we do for our clients is never a statutory power of attorney. We always use the powers of attorney that we have developed. We use a lot of the forms that we pay for with our subscription to WealthCounsel, and these powers of attorney are much more comprehensive and they anticipate that people may need to give away assets towards the end of life.
And they also may need to do some other things like creating a pooled trust or creating a sub-trust under a pooled trust. A statutory power of attorney would not allow you to do that.
Sometimes when people come in, they say, "our loved one has this power of attorney and we want to try and preserve their assets."
We say, "great let's see this power of attorney." If it's a statutory power of attorney, I get a little bit sad because I know that this is not going to allow them to do the things that they want to do.
So, to wrap up: Statutory power of attorney is a great thing, but it's only limited to certain things.
If you really want a comprehensive power of attorney, you should talk to a professional about that. You could talk to us, especially if you're in Wisconsin.