If my sister has power of attorney, can she use the money in my parent's checking account?

2 answers | Last updated: Sep 22, 2016
A fellow caregiver asked...

We have a parent in the hospital in long term care receiving therapy at the moment and her home is under her childrens names. Her one daughter is listed on her checks as "power of attorney" I wondered if it came to the taxes and costs of the home if that daughter could pay the taxes and house costs with that account if her name is on the checks and she has power of attorney? This is in the state of Pennsylvania.

Expert Answers

Barbara Repa, a Caring.com senior editor, is an attorney, a journalist specializing in aging issues, and the author of Your Rights in the Workplace (Nolo), now in its 10th edition.

There are a number of picky details that may affect the legality of making the house and tax payments here.

The first is whether the mother's name is still on the title to the home"”or whether she has habitually continued paying the taxes and home costs with her own money. If so, there is a better legal argument to be made that these expenses should continue to be paid from her checking account.

Another question is whether the power of attorney has actually taken effect. Some are crafted to take effect immediately; some only when the person for whom the POA is made has been formally declared to be mentally incompetent.

If the POA is in effect, the daughter should have no trouble writing a check for the home expenses. This should also be true if she is on the bank account as an additional authorized signature, or if she is a joint holder of the account"”two common scenarios when a person is named POA. Some banks are also willing to set up temporary check writing privileges when the main account holder is not easily available. If she pays, the daughter should keep good records and receipts, however, in case she would ever need to prove why and how the money was spent.

If the mother is in the nursing facility temporarily but it still of sound mind, the POA is not in effect, and the bank is not willing to set up a temporary arrangement, then the daughter may need to take the checks in for the mother to be signed"”and to lobby for a differently-worded POA that would authorize her to do these check-writing and paying tasks on the home.

Community Answers

A fellow caregiver answered...

I am not sure of the laws in this country, I beleive it should be according to documents signed at time of name transfer( this could somewhat like a pre-nuptual time agreement. In Italy, If a child buys a parents property( even quick deed for $1) the parents may say I will give you the property but I want the fruits of the living which in short means the parent wants to live in property to death. In Italy it cost a few thousand $$$$ to have this clause and the child usually pays. This gives peace of mind to the parents Peace of mind. At that age, why not try to have your parent live their life without worrying that their child would kick them out and live in a convalescant home if they choose not. All these and other isues should be in conference with a lawyer. I know of many cases when the child sold the property right under the parents nose..Money can mess up people's minds. I do beleive the daughter of parent should not use $$ for her personal use unless the parent agrees to GIFT her some of the money , especially if she spends more time with parent caring for them. Again, this has a lot of leagel complications. The original arrangement could have been decide the parent would pay for taxes or caring for home etc.