Power of Attorney

Power of AttorneyA Power of Attorney document (POA) allows an agent that you designate to make decisions for you in your legal, financial and business dealings. A POA is written legal authority given by one party (the principal) to another (the agent or attorney-in-fact) to act on the principal’s behalf. The person authorizing the other to act is referred to as the principal, grantor or the donor of the power. The person who has been granted authority to act on behalf of another (i.e. the principal) is called the agent or the attorney-in-fact.

A POA can be a helpful tool in making emergency or unexpected decisions about your retirement benefits. Usually, NYSLRS cannot release benefit information to anyone without your authorization — even to close family members. However, once we have a copy of a valid POA on record, we can discuss your pension with an agent you choose in your POA. With a valid POA, your agent can also change your address with NYSLRS or even adjust your tax withholding.

An agent cannot designate beneficiaries, elect certain options, or make certain banking decisions with a POA alone. However, with the addition of a statutory gift rider (SGR), your agent may be able to perform “gifting” transactions which include depositing money into a joint bank account, designating or changing beneficiaries or electing an option and option beneficiary. The additional gifting powers granted under a statutory gift rider must be specified on the form (Note: We cannot deposit money into an account that does not have your name on it.)

In order for a NY POA with NY SGR to be valid, the POA must contain the gift giving authority initialed by the principal, and a valid SGR must have been created on the same day as the POA. This SGR must be executed pursuant to the requirements of New York’s General Obligations Law §5-1514, which includes being notarized and witnessed by two disinterested witnesses (individuals not named in the POA), in the same manner as the execution of a will.

If you are thinking about executing a POA with a SGR, NYSLRS offers a form that combines the New York State statutory POA with a gift rider. This form meets all of New York State’s legal requirements and authorizes an agent to make all retirement transactions on behalf of a member unless specific limiting language is added. Without any modifying language, the NYSLRS POA and SGR will only allow a named agent to name himself or herself as a beneficiary only if the agent is the spouse, domestic partner, parent or child. The NYSLRS POA with a SGR only authorizes an agent to make retirement benefit transactions. For example, it won’t serve as a healthcare proxy. You can find the form at www.osc.state.ny.us/retire/forms/poa.pdf.

If a member or beneficiary chooses to execute and file the NYSLRS POA with SGR, the form must contain a valid notarization of the principal’s (grantor/donor) signature, the signature of two disinterested witnesses and a valid notarization of the agent’s signature.

NYSLRS recommends that you consult with an attorney to ensure you are using the correct form to meet the needs of you and your family.

4 thoughts on “Power of Attorney

  1. Benjamin Gamoran

    Doesn’t a power of attorney have to be “durable” in case the one making the poa becomes incompetent? I see no reference to durability in your article on this subject.

    Reply
    1. NYSLRS

      The form provided by NYSLRS is a durable power of attorney. Under a durable power of attorney, the agent can act for you even if you become legally incapacitated (see page 1 of the form).

      If you are considering executing a POA, we recommend consulting an attorney.

      Reply
  2. David Stoyell

    The article on Power of Attorney in this issue of New York Retirement News stipulates that you require the Statutory Gift Rider for certain transactions. Many of us have Powers of Attorney that were executed prior to the change in NY State Law that requires the Statutory Gift Rider for new POA’s. However, we were told that the powers granted in our POA’s (that were executed prior to the change in the law) were still valid, including the gift gifting authority that used to be allowed without any rider.

    As the article is written, it is implied that you will not honor our old POA’s and that we have to execute a new one with a Statutory Gift rider if we want our agent to contunue to have that authority. Is this true that you will not honor our old POA’s in this respect?

    Reply

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