When a Power of Attorney Isn’t Enough: What Nebraskans Need to Know About Incapacity, Banks, and Red Tape

Imagine this: your aging father ends up in the hospital and can no longer manage his finances. You step in as his appointed Power of Attorney—only to hear the bank say, “Sorry, we can’t accept this.” Now you’re not only in an emotional crisis but also stuck in a legal and financial one.

This scenario plays out more often than most people realize. And here’s the hard truth: having a Power of Attorney (POA) isn’t enough if it doesn’t work when you need it.

In Nebraska, even a legally valid POA can be rejected by financial institutions. And when time-sensitive decisions need to be made—about money, housing, or medical care—that rejection can throw a family into disarray.

Do I Really Need a Power of Attorney in Nebraska?

Yes. A POA is essential to any Nebraska estate plan. It allows you to appoint someone you trust to make financial or legal decisions if you become incapacitated. But it’s not just about having a form on file. It’s about creating a Power of Attorney that financial institutions will actually honor.

Why Nebraska Banks May Reject a Valid Power of Attorney

Even the most well-intentioned estate plans can hit roadblocks. Banks and brokerage firms often delay or deny POA authority due to:

1. Document Age

Even though Nebraska law doesn’t set an expiration, some institutions treat older POAs as “stale” and reject them out of policy.

2. Missing or Vague Language

Unless your POA specifically authorizes certain actions—like changing beneficiary designations or making gifts—it may not be enough. Generic statements like “all financial powers” won’t always cut it.

3. Multiple Agents

If you’ve named two agents (e.g., your children) to act jointly, some banks may refuse to proceed unless both sign together. If they disagree? You’re stuck.

What Makes a Power of Attorney Work in Nebraska

To ensure your POA is enforceable and effective, especially under the Nebraska Uniform Power of Attorney Act (UPOAA), it should include the following:

Durable Language

Nebraska presumes POAs are durable (i.e., remain valid after incapacity), but adding explicit language removes doubt.

Immediate Effectiveness

“Springing” POAs require proof of incapacity, often through physician certification. That delay can be devastating. Immediate POAs take effect right away, allowing your agent to act without jumping through hoops.

Explicit Powers

Certain powers must be clearly stated or they won’t be honored. These include:

• Changing or updating beneficiary designations

• Creating or modifying trusts

• Making financial gifts

• Managing retirement accounts

• Filing tax returns

• Accessing digital assets (email, cloud storage, banking apps)

Digital Asset Access

Under Nebraska’s Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA), your POA must explicitly grant authority to access online accounts. Otherwise, your agent could be locked out of critical financial tools.

Updated Language and Format

Even if a document is legally sound, outdated formats or vague phrasing can create obstacles. A comprehensive, modern POA—ideally reviewed every 3–5 years—avoids unnecessary challenges.

Why Long POAs Are Better, Not Worse

Clients sometimes ask, “Why is this document so long?” It’s long because it needs to be. Detailed POAs anticipate the roadblocks that banks and brokers often raise. That detail isn’t fluff—it’s what gets your agent through the door when crisis hits.

What If the Bank Still Refuses to Honor It?

Nebraska’s UPOAA requires financial institutions to respond to a POA request within seven business days. If they reject it, they must cite a legal reason and respond again within five more business days. If they fail to comply, you may have legal remedies.

That said, it’s best to pre-clear the POA with your bank while you or your loved one still have capacity. If issues come up, you can fix them before you’re in crisis mode.

Trusts vs. Powers of Attorney: Do You Need Both?

A revocable living trust can be a powerful tool to avoid probate and manage assets during incapacity. But it doesn’t replace a POA. Some assets—like IRAs or government benefits—can’t be placed in a trust. Filing taxes, managing Social Security issues, or handling legal matters still require a POA.

Your trust and POA should work together—not compete.

Bottom Line: A Power of Attorney That Doesn’t Work Isn’t a Plan

A Nebraska POA is only as strong as its wording, structure, and timing. For a POA that actually works, make sure it is:

• Durable

• Immediately effective

• Updated regularly

• Explicit in powers granted

• Accepted and filed with financial institutions ahead of time

• In line with Nebraska law and RUFADAA for digital assets

If your POA is more than five years old—or you’re not sure it will hold up when it matters most—now’s the time to review it. Let’s make sure the people you trust can step in without court delays, confusion, or pushback.

Contact me at 402-259-0059 or zach@zandersonlaw.com to review your current document or create one that actually protects your family.

FAQ: Power of Attorney in Nebraska

What is a durable Power of Attorney in Nebraska?

A durable POA remains valid even if the person who created it becomes incapacitated. Nebraska law assumes POAs are durable, but it’s best to make this explicit in the document.

Can a bank reject my Power of Attorney in Nebraska?

Yes—though they shouldn’t without a valid legal reason. Under the UPOAA, they have seven business days to accept or object to your POA and must provide a legal reason for any refusal.

What is a “springing” POA and should I use one?

A springing POA only takes effect after incapacity is proven. This often creates delays and confusion. An immediately effective POA is typically more useful, especially in emergencies.

Do I still need a Power of Attorney if I have a trust?

Yes. Trusts do not cover all aspects of incapacity planning. A POA allows your agent to handle legal, financial, and tax matters that aren’t covered by the trust.

How often should I update my Power of Attorney?

Every 3–5 years or after major life events (marriage, divorce, illness, new assets). Institutions may push back on outdated forms, so regular updates are key.