Key Takeaways:
- A power of attorney is a legal document that allows you to appoint someone to act on your behalf.
- In Tennessee, financial powers of attorney are governed by the Tennessee Uniform Power of Attorney Act.
- Without a power of attorney, families may need to pursue conservatorship through probate court.
- Durable powers of attorney remain effective if incapacity occurs.
- Healthcare powers of attorney authorize medical decision-making when you cannot communicate.
- Choosing a trusted agent and reviewing documents regularly are essential parts of the planning process.
What would happen if you suddenly became ill or injured and could not make decisions for yourself? Who would manage your finances or speak to your doctors on your behalf?
Many families reach a point where they begin researching “what is a power of attorney” and whether it is necessary for their situation. That moment often comes during a medical emergency or unexpected life event, when loved ones discover they do not have the legal authority to step in.
In this guide, we will explain how it works under Tennessee law and why creating one can help protect your independence and ease the burden on your family.
What Is a Power of Attorney?
A power of attorney is a legal document that allows one person (the principal) to appoint another (the agent or attorney-in-fact) to act on their behalf. The authority granted can include:
- Managing bank accounts
- Paying bills
- Signing contracts
- Filing taxes
- Making healthcare decisions.
The scope depends on how the document is drafted.
In Tennessee, financial powers of attorney are governed by the Tennessee Uniform Power of Attorney Act, found in Tennessee Code Annotated § 34-6-101 and following sections. This law outlines what makes a power of attorney legally valid, how it must be signed, and the duties an agent must uphold.
Importantly, signing a power of attorney does not mean you lose control. As long as you have capacity, you retain full authority over your own decisions. The agent’s role is to act according to the powers you grant and in your best interest.
What Types of Power of Attorney Exist in Tennessee?
Not all powers of attorney are the same. The type you choose depends on your needs, your stage of life, and the level of authority you want to grant. Tennessee law recognizes several forms of power of attorney, each serving a different purpose.
1. Durable Power of Attorney
A durable power of attorney is the most common type of power of attorney used in estate planning. “Durable” means the document remains effective even if you become incapacitated.
Under Tennessee’s Uniform Power of Attorney Act, a power of attorney is considered durable unless the document states otherwise. This makes it a powerful tool for long-term planning, as it allows your chosen agent to continue managing your financial affairs if you are unable to do so due to illness, injury, or cognitive decline.
2. Healthcare Power of Attorney
A healthcare power of attorney allows you to appoint someone to make medical decisions on your behalf if you cannot communicate your wishes.
In Tennessee, healthcare decision-making is governed by the Tennessee Health Care Decisions Act. This document works alongside advance directives and living wills. It authorizes your agent to speak with doctors, review medical records, and consent to or refuse treatment according to your preferences.
3. Limited or Special Power of Attorney
A limited power of attorney grants authority for a specific task or for a specific period of time. For example, you might authorize someone to sign real estate documents while you are out of state or handle a single financial transaction. Once the specified task is completed or the time period expires, the authority ends.
4. Springing Power of Attorney
A springing power of attorney becomes effective only after a triggering event, usually a written determination that you are incapacitated.
While this structure can provide an added sense of control, it may also create delays if financial institutions require proof of incapacity before recognizing the document. Careful drafting is essential to avoid confusion or disputes.
Why Would You Need a Power of Attorney?
A power of attorney is not just a legal form. It is a safeguard for unexpected situations. Illness, injury, or cognitive decline can happen at any age. When that occurs, someone must have legal authority to manage medical and financial affairs.
Without a valid power of attorney, loved ones cannot automatically:
- Access bank accounts or manage investments
- Pay mortgages, utilities, or medical bills
- Speak with doctors about treatment decisions
- Apply for Medicaid or coordinate long-term care
- Handle insurance claims or tax matters
Setting a power of attorney in advance reduces court involvement, preserves privacy, and allows a trusted agent to act when needed.
What Happens If You Do Not Have a Power of Attorney?
When a power of attorney is not in place and incapacity occurs, decisions cannot simply be made by family members. Even a spouse or adult child may lack legal authority to act.
In Tennessee, the typical next step is a conservatorship proceeding in probate court.
Court-Appointed Conservatorship
A conservatorship is a legal process in which a Tennessee court appoints a person to manage the financial or personal affairs of an incapacitated adult. The process generally involves:
- Filing a petition in probate court
- Providing medical evidence of incapacity
- Giving notice to close family members
- Attending a court hearing
- Ongoing court supervision after appointment
If a conservator is appointed, that individual must act under court oversight. Annual accounts and reports are often required. Certain financial decisions may require court approval before action can be taken.
The Practical Impact on Families
Conservatorship proceedings can be:
- Time-consuming
- Costly due to court and attorney fees
- Public, since court records are typically accessible
- Emotionally stressful during an already difficult period
In addition, the court ultimately decides who serves as conservator. That individual may not be the person the incapacitated adult would have selected.
Creating a valid power of attorney in advance helps avoid this process. It allows a trusted agent to act without court involvement, preserving privacy and reducing delays during medical or financial emergencies.
How to Choose the Right Agent
Selecting an agent is one of the most important decisions involved in creating a power of attorney. This person may have authority over finances, healthcare decisions, or both. The role requires trust, responsibility, and sound judgment.
When choosing an agent, consider:
- Integrity and reliability
- Financial responsibility and organizational skills
- Willingness to serve
- Ability to communicate with family members and professionals
- Proximity, especially for healthcare decisions
It is also wise to name a successor agent in case the first choice is unable or unwilling to serve.
Before signing the document, discuss expectations with the person selected. An agent should understand the responsibilities involved, including the fiduciary duty to act in the principal’s best interest and follow Tennessee law.
When Should You Create or Update a Power of Attorney?
A power of attorney is not only for older adults. Any adult over 18 can benefit from having one in place.
It is especially important to review or create a power of attorney during:
- Major life events such as marriage or divorce
- The birth of a child
- A significant change in assets
- A move to Tennessee from another state
- The diagnosis of a serious medical condition
State laws vary, and documents created in another state may not fully comply with Tennessee requirements. Periodic review helps confirm the document reflects current wishes and legal standards.
How Elder Law of Nashville Assists with Power of Attorney Planning
A power of attorney is rarely a standalone document. It works best as part of a broader estate and incapacity planning strategy.
At Elder Law of Nashville, planning often includes coordination between:
- Financial powers of attorney
- Healthcare powers of attorney
- Advance directives
- Wills and trusts
- Long-term care and Medicaid planning
Proper drafting reduces ambiguity and helps financial institutions and healthcare providers recognize the authority granted. It also aligns decision-making authority with overall estate planning goals.
Take Control of Your Legal and Financial Future
A power of attorney is one of the most effective ways to prepare for the unexpected. It gives you the ability to choose who will step in if you are ever unable to manage your own affairs. Without one, important decisions may be delayed, and families may be forced into court proceedings during already stressful times.
For individuals and families in Tennessee, early planning can make all the difference. Contact Elder Law of Nashville to learn how a properly drafted power of attorney can support your broader estate and long-term care goals.
FAQs: What is a Power of Attorney?
Q: When does a power of attorney take effect?
A power of attorney can take effect immediately upon signing or only after a triggering event, such as incapacity. The timing depends on how the document is drafted.
Q: Does a power of attorney override a will?
No. A power of attorney only applies during a person’s lifetime. A will takes effect after death. The agent’s authority ends at the principal’s death.
Q: Can a power of attorney be revoked?
Yes. As long as the principal has legal capacity, a power of attorney can be revoked at any time by providing written notice and executing a revocation document.
Q: Does a spouse automatically have power of attorney?
No. Marriage alone does not grant automatic authority to manage finances or make medical decisions. Proper legal documentation is required.