How Far Can You Go With Estate Planning? Many of us consider a Power of Attorney (POA) document essential to the estate plan. The document is utilized while the Power’s donor (or “grantor”) is alive and usually incapacitated. The POA is distinguishable from a Will, which takes effect on death. The question often arises as to what extent a person named in a POA can engage in estate planning on behalf of the donor of the Power.

We are often asked what steps can be taken by a person named in a Power of Attorney to engage in estate planning on behalf of the donor (or “grantor”) of the Power. Typically, the attorney is the child of the incapable person and seeks to avoid probate, minimize taxes on death, or engage in other estate planning. Some of the transactions contemplated include transferring property into the attorney’s or siblings’ names, making gifts or loans to family members, selling property and placing the proceeds in the attorney’s or siblings’ accounts. Difficulties with these and similar transactions arise due to the inherent conflict of interest when the attorney is a family member.

Source: Manulife Financial

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