Powers of Attorney (POAs) are powerful legal instruments prepared under state law that allow one individual (the “principal”) to authorize another (the “agent” or “attorney-in-fact”) to make decisions on their behalf. While POAs are widely recognized in Florida and are extremely useful for managing personal, financial, and health care matters, they are not always accepted by federal agencies. Understanding these limitations is essential for proper estate and elder care planning.
1. Powers of Attorney vs. Federal Agencies
POAs created under Florida law may be effective for many purposes, but federal agencies often require separate, agency-specific authorizations. The following is how the POA interacts, or does not, with several major agencies:
A. Social Security Administration (SSA)
- Does NOT accept POAs.
- Instead, the SSA requires a Representative Payee to manage Social Security benefits for individuals deemed incapable of managing their own finances.
- To become a representative payee, one must contact their local SSA office and go through an application and vetting process.
- Funds must be deposited into a separate account titled in the name of the beneficiary, using the beneficiary’s Social Security number, not the representative’s.
- For information: www.ssa.gov/payee
If you are helping a loved one file for benefits or handle appeals, the SSA allows you to become an Authorized Representative by submitting Form SSA-1696.
B. U.S. Department of Veterans Affairs (VA)
- Like SSA, the VA does not honor standard POAs for managing veteran’s benefits.
- If a veteran or their surviving spouse is declared incompetent, the VA appoints a fiduciary to handle VA benefits.
- A thorough investigation is conducted before appointment.
- Fiduciaries must file annual accountings and retain receipts for all transactions.
- For more information: benefits.va.gov/fiduciary
C. Medicare (Centers for Medicare & Medicaid Services)
- Medicare requires written or verbal authorization to release personal health information to a caregiver.
- Verbal authorization may suffice for basic inquiries, but a standing authorization is strongly recommended.
- To obtain ongoing access, complete the 1-800-MEDICARE Authorization Form or Form CMS-1696 (used for appeals or coverage determinations).
D. Other Federal Agencies
- Agencies such as the Office of Personnel Management (OPM) and the Railroad Retirement Board (RRB) also require appointed representative payees rather than relying on POAs.
- IRS (Internal Revenue Service) – The IRS does not accept a general POA. Instead, agents must complete IRS Form 2848 (Power of Attorney and Declaration of Representative) to represent a taxpayer.
- Each agency may have unique rules for handling incapacity or representation.
2. What POAs Cover and Do not Cover
- A Florida Durable Power of Attorney typically allows an agent to handle:
- Real estate transactions
- Banking
- Insurance matters
- Lawsuits
- Government benefits (when allowed by state agencies)
- Health care decisions (if covered under a separate Health Care Surrogate designation)
- Limitations: POAs do not automatically grant access to:
- Federal benefits (SSA, VA, etc.)
- Some state-managed retirement benefits
- Private insurance communications (without their specific authorization forms)
3. Best Practices for Caregivers and Families
- Create and maintain up-to-date POAs and other estate planning documents while the principal still has capacity.
- Apply for representative payee or fiduciary status where required.
- Keep meticulous records of transactions if acting on behalf of a beneficiary.
- Use separate accounts for SSA and VA benefits as required by law.
- Be prepared to provide copies of authorizing documents frequently.
4. Practical Tips for Navigating Bureaucracies
- Be patient and persistent.
- Politely escalate to a supervisor when necessary.
- Contact legal counsel if you are facing continued resistance or unclear requirements.
- Keep extra copies of all legal documents readily available, including POAs, health care surrogates, and benefit authorizations.
Conclusion
Serving as a caregiver or advocate for a loved one is both an honor and a responsibility. Understanding the limits of a Power of Attorney, especially when dealing with federal agencies, is crucial. Proper planning, documentation, and agency-specific authorizations will help you manage your loved one’s affairs effectively and lawfully.
For help preparing Powers of Attorney, navigating agency-specific requirements, or handling estate planning, contact an experienced Florida attorney.
The foregoing is a brief and general overview of the topic and the need for specific and experienced legal and tax advice is emphasized.
If you have questions about creating a Power of Attorney, an estate plan, or any related legal matter, contact the experienced attorneys at CASERTA & SPIRITI in Miami Lakes, Florida.
