Sandra’s husband, Clyde, was a business owner for 30 years. He recently suffered a stroke and now lives in a nursing home. He can no longer manage his business. Sandra is his Power of Attorney and asked me whether she’s responsible for Clyde’s business matters in addition to his personal care.
The answer depends on many factors. The first is the legal form of his business: sole proprietorship, partnership, or corporation. A sole proprietor is the single person who owns and runs a business. If Clyde was a sole proprietor, the next factor is the Power of Attorney. Sandra needs to take it to a lawyer who can advise her on what to do — whether the document does or does not mention Clyde’s business. Among the questions she needs to ask:
- When quarterly taxes are due and how she can find out how much is due
- The papers she needs to file with the state to close the business and notifications to state and federal tax agencies
- Whether it’s appropriate for her to inform Clyde’s customers/clients of the situation
- How to dispose of property belonging to the business
- How long to retain financial and other documents
If Clyde was a partner in a business or owned a corporation, Sandra needs to read the partnership documents or articles of incorporation to determine what, if anything, she must do. Again, she should consult with an attorney for guidance on gaining access to those documents and on her responsibilities as Clyde’s POA. She also needs information on any rights Clyde retains, such as health insurance, retirement benefits, stocks, and so on. The information is crucial in determining how much money is and will be available to care for Clyde and for her, when the time comes.