How to Make a Power of Attorney in Texas FAQ

What Is a Power of Attorney?

A power of attorney is a legal document where someone, called a principal, authorizes someone else, called an agent, to act on behalf of the principal. A financial power of attorney is where an agent handles financial matters for the principal. For healthcare matters and medical decisions, a principal would create a medical power of attorney.

Who Can Be My Agent?

An agent must be an adult and competent (meaning having a sound mind). They have a fiduciary duty to act in good faith for your best interest. You can choose a family member, other loved one or friend, or an institution to handle your financial affairs. Your agent should be someone you trust because they are handling your money and your life. Be sure to name a backup or successor agent in case your primary agent is unable or unwilling to serve. Avoid using co-agents as they may conflict with how to proceed, and nothing gets done or confuse banks and others by acting independently and reversing each other’s actions.

What Can My Agent Do in Texas?

Your agent can do what you authorize them to do, essentially acting as you. For example, they can access your bank accounts, bind you to contracts, and pay your bills. In the state of Texas, you can authorize your agent’s authority to handle the following:

• Real estate transactions
• Tangible personal property transactions
• Stock and bond transactions
• Commodity and option transactions
• Banking and other financial institution transactions
• Business operating transactions
• Insurance and annuity transactions
• Estate, trust, and other beneficiary transactions
• Claims and litigation
• Personal and family maintenance
• Benefits from Social Security, Medicare, Medicaid, or other governmental programs or civil or military service
• Retirement plan transactions
• Tax matters
• Digital assets and the content of an electronic communication

However, there are certain powers that you must specifically authorize your agent to handle by initialing those. These powers can reduce your estate. Giving these powers to your agent is up to you. Some people may want their agent to be able to reduce their estate for tax purposes or to qualify for government benefits such as Medicaid. These are the powers to do the following:

• Create, amend, revoke, or terminate a living trust
• Make a gift, subject to the limitations of Texas’ Durable Power of Attorney Act §751.032
• Create or change rights of survivorship
• Create or change a beneficiary designation
• Authorize another person to exercise the authority granted under the power of attorney.

Think carefully about what you want your agent to have the power to do when acting on your behalf.

What Is a Durable Power of Attorney in Texas?

A non-durable power of attorney ends upon the principal’s incapacitation unless the principal drafts a durable power of attorney. A durable power of attorney remains effective even if the principal becomes incapacitated. This contrasts with a non-durable power of attorney, which would terminate upon the principal’s incapacitation. To indicate a durable power of attorney, the principal must include something like “This power of attorney is not affected by subsequent disability or incapacity of the principal” or similar language.

When Is the Power of Attorney Effective?

The effectiveness of a power of attorney depends on the terms outlined in the document. It can become effective immediately upon signing or upon the occurrence of a specified event, such as the principal’s incapacitation. To determine incapacity, a physician will examine the principal and declare that the principal is mentally incapable of managing their affairs. A principal can even make a limited power of attorney that operates for a short period of time, such as the principal being on vacation or for a specific transaction, such as a real estate closing.

When Does the Power of Attorney End?

A power of attorney ends when the principal dies or is incapacitated and is a non-durable power of attorney. There are other occurrences that terminate the power of attorney, such as:

• The agent dies, and there is no successor agent
• The agent is incapacitated, and there is no successor agent
• The principal revokes the power of attorney
• The power of attorney has a termination date or event, and that date or event occurs

Additionally, if your agent is your spouse and you divorce or a court declares your marriage void, your spouse’s authority to act as your agent ends.

Does Texas Have a Statutory Power of Attorney?

Yes. There is a Texas power of attorney form under §752.051 of the Texas Estates Code. However, this form may be limited. You can create your own power of attorney customized to your needs or hire an estate planning attorney to draft one for you.

Can I Make My Own Power of Attorney in Texas?

Yes. You can create your own power of attorney document in Texas if you follow Texas law when drafting and signing. If using online power of attorney forms, make sure they follow Texas’ legal requirements. If you have questions about what powers to grant or who should be your agent, consult an estate planning attorney for legal advice.

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How Do I Make My Power of Attorney Valid in Texas?

The principal must be a legal adult and competent. They must sign the power of attorney or direct someone else to sign it for them on their behalf and in their presence. This signing must be done in the presence of a notary public who attests to their signature.

Do I Have to Notarize My Power of Attorney?

Yes. Notarization is required to ensure the validity of the power of attorney document in Texas.

What Should I Do After Signing My Power of Attorney?

Once you have signed your power of attorney before a notary, keep the original in a safe place. Distribute copies to your agent, backup agents, and any banks or financial institutions needing them. Some banks or companies may require your agent to complete an agent certification form in which your agent swears in front of a notary that the power of attorney is valid, and they have the authority to act as your agent.

Does a Power of Attorney Agent Get Paid?

Your agent may receive reimbursement for reasonable expenses incurred when serving as your agent under your power of attorney. They may also receive reasonable compensation for their services unless you state otherwise in your power of attorney document.

Is My Texas Power of Attorney Valid in Another State?

Yes. If you create a valid power of attorney according to the laws of Texas, other states will likely honor it as well.

Can I Revoke My Texas Power of Attorney?

Yes. You can revoke your power of attorney if you are still mentally competent. To revoke a power of attorney, you should create a “Revocation of Power of Attorney” naming your agent, the date of the original power of attorney, and your intention to revoke the power of attorney. Sign before a notary and give this revocation to your agent and any bank or financial institution that received the initial power of attorney.

What Estate Planning Documents Should I Have in Texas?

There are other documents to have for a complete estate plan. A Health Care Directive combines a medical power of attorney with a living will or advance directive. In this document, you name someone to access your medical records and make healthcare decisions on your behalf. It also lets you leave instructions on what end-of-life measures you want or do not want when you have an end-stage illness or terminal condition.

Additionally, you should draft a last will and testament. In a will, you name who you want to handle your estate, who you want to inherit your property, and who should care for your children and pets. Having a will streamlines the probate process, saving your loved ones time and money in probate court.

Fortunately, making a valid power of attorney and creating other Texas estate planning documents is easy with online estate planning templates.