Most conversations about estate planning focus on what happens at death. A durable power of attorney (DPA) focuses on what happens while you are still alive, but unable to handle your own financial affairs. A stroke, a serious accident, a progressive illness, or simply advanced age can leave someone unable to sign checks, manage investments, deal with the IRS, or handle a real estate transaction. Without a valid DPA in place, the family’s only option is often a court conservatorship, which is slow, public, and expensive. A well-drafted DPA prevents that.
The Basic Concept
A power of attorney is a written document in which one person (the “principal”) authorizes another person (the “agent” or “attorney-in-fact”) to act on the principal’s behalf. The agent is not an attorney in the sense of a lawyer. The term comes from the older legal vocabulary in which someone authorized to act for another was called an attorney.
Durable vs. Non-Durable
At common law, a power of attorney terminated automatically when the principal became incapacitated. That made the document useless at precisely the moment it was most needed. Massachusetts, like every other state, now recognizes the “durable” power of attorney, remains effective despite the principal’s later incapacity.
A power of attorney is durable if it contains language showing the principal’s intent that the agent’s authority continue through the principal’s later disability or incapacity. In practice, nearly every power of attorney signed as part of an estate plan is drafted as durable. A non-durable power of attorney may be drafted for a specific transaction, such as closing a single real estate deal.
Springing vs. Immediate
A power of attorney can be drafted to take effect the moment it is signed (an “immediate” or “presently effective” power), or it can be drafted to take effect only upon the principal’s incapacity (a “springing” power).
The springing power is intuitively appealing. Many prefer the idea that the agent cannot act while the principal is still able to handle their own affairs. But in practice, springing powers create problems. Determining whether the principal has become “incapacitated” usually requires medical documentation, sometimes from two physicians, and that process can itself be slow. Banks and brokerages are often hesitant to accept a springing power without clear proof of the triggering event.
The more common recommendation is an immediate power given to a trusted agent (typically a spouse, adult child, or close family member). The principal retains full control and the agent simply does not use the authority until needed. This approach trades a bit of theoretical risk for substantial practical flexibility.
Scope of Authority
The power of attorney can be broad (authority over essentially all of the principal’s financial affairs) or narrow (authority for a single transaction). A comprehensive DPA used in estate planning typically covers:
Banking. Opening and closing accounts, depositing and withdrawing funds, writing checks, wiring money, and dealing with banks on all matters.
Real estate. Buying, selling, leasing, or mortgaging real property.
Investments. Buying, selling, and managing securities, commodities, and other investments. Some brokerage firms require their own internal power of attorney forms in addition to the general document.
Tax. Signing tax returns, dealing with the IRS and the Massachusetts Department of Revenue, and representing the principal in tax matters.
Gifting. The authority to make gifts on the principal’s behalf is not implied. In Massachusetts, the power to make gifts must be stated expressly in the document, and the scope of the gifting power (annual exclusion only, unlimited, gifts to the agent personally) should be spelled out.
Retirement accounts. The authority to deal with IRAs and 401(k)s, including taking distributions and changing beneficiaries if authorized.
Digital assets. Access to online accounts, email, and digital property. As of April 2026, Massachusetts has not enacted the Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) , so clear authorization in the DPA is particularly important.
The Agent’s Duties
An agent under a DPA is a fiduciary. The agent must act in the principal’s best interest, keep the principal’s funds separate from the agent’s own, maintain records, and avoid self-dealing unless the document expressly authorizes it. Breaching these duties can expose the agent to personal liability.
Why Financial Institutions Can Be Tricky
A legally valid DPA sometimes meets resistance at the bank or brokerage. Institutions worry about liability if they accept a forged or outdated document, and many have internal policies requiring their own forms or requiring that the power of attorney be reviewed by their legal department before it is honored.
This is a practical problem, not a legal one. Under Massachusetts law, a third party generally must accept a valid power of attorney, but the enforcement path (a lawsuit against the institution) is slow and expensive. In practice, families benefit from presenting the DPA to the principal’s primary financial institutions shortly after it is signed, asking the institution to log the document, and dealing with any objections while the principal is still able to sign supplemental forms. An older document that has never been presented to the bank is much harder to put into use after the principal becomes incapacitated.
Successor Agents
A single agent is a single point of failure. If the named agent dies, becomes incapacitated, or is unwilling to serve, the document is no help unless a successor is named. Many DPAs name a primary agent and at least one successor, sometimes two.
Multiple agents serving concurrently is also possible. The document can require them to act jointly, independently, or by majority. Joint authority provides more oversight but slows down every transaction. Independent authority is faster but relies on the agents trusting each other.
Revocation
A principal who is still competent can revoke a power of attorney at any time. Revocation is accomplished by a written revocation signed by the principal and delivered to the agent, along with notice to any third party (such as a bank) that has relied on the power. The older document should be physically retrieved or marked “revoked” to reduce confusion.
A DPA terminates at the principal’s death. At that point, authority over the principal’s assets transfers to the personal representative appointed by the probate court, or the trustee of the trust holding the principal’s assets.
Planning Ahead
A durable power of attorney is one of the lowest-cost, highest-value pieces of an estate plan. It is often the document that makes the biggest practical difference in a family’s life, because it is the one used during a period of incapacity rather than after death. Families in Massachusetts should confirm that each adult has a current, durable, comprehensive DPA in place, with appropriate agents, successor agents, and any special provisions clearly addressed.
References
- MGL c. 190B, section 5-501 (durable power of attorney, general)
- MGL c. 190B, section 5-502 (effect of acts by agent during disability of principal)
- MGL c. 190B, section 5-504 (power of attorney not revoked until notice)