A power of attorney is one of the most widely used legal documents. It allows individuals to transfer the power to manage their financial affairs to one or more agents. Doing so may avoid the need for a time-consuming and expensive guardianship proceeding when a person becomes incapacitated. The power of attorney is also widely used in many specific, limited transactions, such as real estate closings, allowing the agent to sign on behalf of the principal.

On June 13, 2021, a new version of the New York Statutory Short Form Power of Attorney went into effect.  Any powers of attorney executed before this date that complied with the earlier 2010 law continue to be valid. However, powers of attorney executed after June 13, 2021 must comply with the new requirements.

Legislation enacting the 2021 New York Statutory Short Form Power of Attorney and certain provisions of Sections 5-1501 through 5-1514 of the General Obligations Law intended to simplify the Power of Attorney and achieve the following objectives:

  • to permit substantially compliant language, as requiring exact wording is an undue burden;
  • to provide “safe harbor” provisions for those who in good faith accept an acknowledged POA without actual knowledge that the signature is not genuine;
  • to permit sanctions against any individual or entity (banks, financial institutions, etc.) that unreasonably refuses to accept a valid POA;
  • to allow a person to sign at the direction of the principal, if the principal is physically unable to sign;
  • to permit the agent to make gifts of up to $5,000 per year (increased from the previous limit of $500) without requiring a modification to the form;
  • to remove all of the provisions that apply to the Statutory Gifts Rider (SGR);
  • to clarify the obligations of the agent under the POA to keep records and receipts; and
  • to clarify the agent’s authority related to financial matters concerning the principal’s health care.

Because of the important and wide-ranging powers granted to an agent through a power of attorney document, it is recommended that individuals seek advice from an attorney before signing one.

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New York Statutory Power of Attorney FAQ's

New York State has enacted a new statutory Power of Attorney effective June 13, 2021. Due to the potential to assign significant powers to an Agent, we strongly urge consultation with an attorney before executing a Power of Attorney.