On December 15, 2020, Governor Andrew Cuomo signed new legislation changing the NYS Power of Attorney. The new law becomes effective on June 13, 2021. The changes are intended to simplify and make the Power of Attorney a more user-friendly document. Two of the most significant changes are:
1. The elimination of the Statutory Gifts Rider, a separate form that was required to be included with a power of attorney that allowed the agent to give gifts. It can now be added in the modifications section of the POA. Absent this modification, an agent may make gifts up to $5,000 annually.
2. The addition of the procedure for the refusal to honor a Power of Attorney. Third parties have 10 days to honor or reject the power of attorney. Notice of any rejection must be sent in writing to the principal and the agent unless there is suspicion of abuse and the case has been referred to Adult Protective Services. The court may award damages, including reasonable attorney’s fees and costs, if the court finds that the third party acted unreasonably in refusing to honor the agent’s authority.
Other changes to the Power of Attorney include:
3. “Substantially conforms to the wording” replaces “exact wording.” Under previous law, banking institutions, for example, may refuse to accept a POA because of something minor like a misspelling, which rendered it a non-statutory form. Under the new law, failing to include clauses that are not relevant to a given power of attorney shall not invalidate the power of attorney.
4. Any section indicated as “Optional” may be omitted and replaced by “Intentionally Omitted.” This negates the need to include provisions that are rarely used and do not apply.
5. People unable to sign will be able to direct someone else to sign on their behalf. The power of attorney must be signed by two witnesses (one of whom can be the notary).
6. Changes to the Construction Sections.
Banking
Changes cannot be made to Joint Accounts unless the authority to make changes is expressly stated in the Modifications Section.
If a Power of Attorney requires that two or more agents act together as co-agents, one or more agents may delegate to the co-agent the authority to conduct banking transactions if the principal initialed subject (o) in the grant of authority provisions of paragraph (f) of the statutory short form.
Financial Matters Related to Health Care
This authority shall not include the authorization for the agent to make health care decisions for the principal.
Retirement Benefit Transactions
Changes cannot be made to beneficiary designations unless the authority to make changes is expressly stated in the Modifications Section.
Please feel free to contact the attorneys of the Trusts & Estates Group at Goetz Fitzpatrick LLP at 212.695.8100 ext. 289 to discuss any questions you may have regarding the new Power of Attorney and whether your estate plan needs to be updated accordingly.
Goetz Fitzpatrick LLP has been offering clients insightful solutions throughout the New York Metropolitan area since 1967. The firm provides its clients with expertise in the areas of Construction and Real Estate, Trusts & Estates Administration & Litigation, Commercial Litigation, Corporate, Bankruptcy, and Labor & Employment. The firm’s office is located at One Penn Plaza, Suite 3100, New York, NY 10119, Telephone 212 695 8100, [email protected], www.goetzfitz.com. You can learn more about Goetz Fitzpatrick on: LinkedIn | X (Twitter) | Soundcloud | YouTube | Facebook | Instagram
