Alabama Power of Attorney Laws

Make a durable POA in Alabama so someone can help you with your financial matters if you ever become incapacitated.

If you want to authorize someone to deposit your checks at your bank, file your taxes, or even sell or mortgage your home, you can create a handy document called a power of attorney. A POA is a simple document that grants specific powers to someone you trust—called an "agent" in Alabama—to handle certain matters for you.

What Types of Power of Attorneys Are Available in Alabama?

You can make several different types of POAs. In particular, many estate plans include two POAs that are effective even if you become incapacitated: a financial POA, which allows someone to handle your financial or business matters, and a medical or health care POA (incorporated into a larger document called an "advance directive for health care" in Alabama), which allows someone to make medical decisions on your behalf. Both of these POAs are what are known as "durable" POAs, which means that they retain their effectiveness even after you're incapacitated. It's a good idea for most people to create these two documents, as they help plan for the unexpected.

To learn about other types of POAs, including non-durable (limited) and springing POAs, see What Is a Power of Attorney. Below, learn how to create a durable financial POA that is valid in Alabama.

What Are the Legal Requirements of a Financial POA in Alabama?

Alabama requires that the person making a power of attorney be of sound mind. In other words, the person must be "able to understand and comprehend his or her actions." (Troy Health and Rehabilitation Center v. McFarland, 187 So.3d 1112 (Ala. 2015).) If you're helping someone create a POA, you'll want to make sure that they understand the powers they are giving away.

In addition, in Alabama, a POA must be signed before a notary public.

Steps for Making a Financial Power of Attorney in Alabama

1. Create the POA Using a Statutory Form, Software, or Attorney

Alabama offers a statutory form (a form drafted by the state legislature) with blanks that you can fill out to create your POA. However, statutory forms are often full of legalese, and it's not always apparent how to fill them out. For a more user-friendly experience, you can try a software program like WillMaker, which guides you through a series of questions to arrive at a POA that meets your specific aims and is valid in your state. You can also hire an Alabama lawyer to create a POA for you. Many lawyers will include durable POAs as part of a more comprehensive estate plan alongside a will or living trust.

Whatever method you choose, the process of making the POA will include deciding what powers you want to grant your agent. You can choose to give your agent general authority over all available powers, or you can select specific powers from a list. For example, you might choose to grant your agent power over:

  • Real property (real estate)
  • Stocks and bonds
  • Banks and other financial institutions
  • Retirement plans, and
  • Taxes

An optional Special Instructions section in the Alabama POA also allows you to give special instructions with respect to any of the powers.

In Alabama, the power of attorney is durable by default (meaning it remains effective after your incapacitation) unless you explicitly state otherwise in the document.

2. Sign the POA in the Presence of a Notary Public

As mentioned above, you cannot simply sign the document and call it a day. In Alabama, you must sign the POA in the presence of a notary public.

3. Store the Original POA in a Safe Place

Once you have completed the POA, store the original in a safe place that your loved ones can easily access, and let them know where to find it. (It won't do much good locked away in a safe that no one can get into.) If you become incapacitated, your agent will need the original POA to act on your behalf.

4. Give a Copy to Your Agent

You should also give a copy of the power of attorney to your agent so that your agent is familiar with the contents of the document.

5. File a Copy With the Land Records Office

If you checked off "real estate transactions" as one of the powers you granted to your agent, you should also file a copy of your POA in the land records office of any county where you own real estate. This will allow the land records office to recognize your agent's authority if your agent ever needs to sell, mortgage, or transfer real estate for you.

6. Consider Giving a Copy to Financial Institutions

You can also give copies of your durable financial POA to banks or other institutions that your agent might need to deal with in the future. This step might eliminate some hassles for your agent if your agent ever needs to use the POA. However, it's not necessary.

Who Can Be Named an Agent in Alabama?

Legally speaking, you can name almost any competent adult to serve as your agent. (There are very limited exceptions; for example, you can't name an employee of your assisted living facility as your agent unless you are related to the person.) But you'll want to take into account certain practical considerations, such as the person's trustworthiness, financial sense, and geographical location. For more on choosing agents, see What Is a Power of Attorney.

Alabama allows you to appoint co-agents who are authorized to act at the same time, but it's usually advisable to stick to just one agent to minimize potential conflicts. However, naming a "successor" agent—an alternate who will become your agent if your first choice is unavailable for any reason—is always a good idea, as it creates a backup plan.

When Does My Durable Financial POA Take Effect?

In Alabama, unless you've explicitly stated otherwise in the document, your durable financial power of attorney takes effect as soon as you've signed it before witnesses and a notary public. It's possible to create a condition that must be satisfied before the POA becomes effective—such as a doctor declaring that you are incapacitated—but there are many reasons why this type of "springing" power of attorney is not usually advised.

When Does My Power of Attorney End?

Any power of attorney automatically ends at your death. It also ends if:

  • You revoke it. As long as you are mentally competent, you can revoke your document at any time.
  • No agent is available. To reduce the likelihood of this happening, you can name a successor (alternate) agent in your document.
  • You get a divorce. In Alabama, if you file for divorce or annulment and your ex-spouse is named as your agent in your POA, that designation automatically ends. If you named a successor agent, that person would become your agent.
  • A court invalidates your document. It's rare, but a court may declare your document invalid if it concludes that you were not mentally competent when you signed it, or that you were the victim of fraud or undue influence.

For more on Alabama estate planning issues, see our section on Alabama Estate Planning.

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