Florida's New Power of Attorney Law Makes Significant Changes

Florida has a new power of attorney law that makes major changes to the way powers of attorney work in the state. The law affects any powers of attorney signed after September 30, 2011.

One of the biggest changes is that springing powers of attorney will no longer be valid in Florida. A springing power of attorney does not become affective until the principal becomes incapacitated. The new law includes an exception for military powers of attorney that become affective when a soldier is deployed. In addition, springing powers of attorney signed before October 1, 2011, will still be valid as long as the principal's primary physician is licensed in Florida and enters an affidavit testifying to the principal's incapacity. It is not clear whether an out-of-state springing power of attorney would still be valid in Florida.

Another important change to Florida’s new power of attorney law is that every single power the agent might exercise must be specified. An agent will not be able to perform any tasks that are not specifically enumerated in the power of attorney document. In addition, certain powers will not be affective unless they are specifically set forth in the document and the principal has signed to accept the provision. The following are the powers that the principal must specifically agree to: 

• The power to create an inter vivos trust.
• The power to amend, revoke or terminate a trust.
• The power to make a gift.
• The power to create or change a beneficiary designation.
• The power to waive the principal's rights to be a beneficiary of a joint and survivor annuity.
• The power to disclaim property or powers of appointment.

The new law sets out new rules regarding an agent's compensation. An agent can be reimbursed for any reasonable expenses that occurred, but only certain agents can receive compensation. The agent must be the principal's spouse or heir, a financial institution with trust powers and a place of business in Florida, an attorney or accountant licensed in Florida, or a Florida resident who has never been an agent for more than three principals at a time.

Financial institutions often reject powers of attorney and the new law addresses this issue. It requires that third parties either accept or reject the power of attorney within a reasonable period of time (four business days is presumed to be a reasonable period for financial institutions) and provide a written explanation for the rejection.

The February 7, 2012, issue of Steve Leimberg's Estate Planning Newsletter offers a detailed analysis of Florida’s new power of attorney law by members of the Clearwater law firm of Gassman, Bates & Associates, P.A.

For more information about the new law, click here and here.

To read the new law, click here.