You might want to consider contacting Adult Protective Services to let them know what you have discovered. Financial abuse of vulnerable persons is never OK. Not paying the taxes is putting their home at risk, it is amazing that it has been five years. You might want to check for yourself to be sure the property is not being sold to pay the back taxes.
Also, WA has an action a non-lawyer can file on behalf of a vulnerable person. This is similar to Domestic Violence, but you can allege there are financial issues and ask the Court to intervene and they will. If your sister is keeping you away from your folks, that is alienation, especially when it is to your parent's detriment.
Your allegations regarding the taxes and the water service are very worrisome. Hope this helps.
The forms are on the forms page at courts.wa.gov Elizabeth Powell
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You haven't indicated under what authority your sister has acted. Is it a POA or a guardianship? If it is a POA and your parents are competent then they can revoke the power if they so choose. If they are unwilling because everything seems fine to them, you could report the matter to Adult Protective Services as elder abuse. They will investigate. Just be sure to tell them about the taxes and water. You may need to petition the court to be appointed as your parents' guardian/conservator. If your sister already has that authority, you could petition for an accounting and to have her removed. Any way you go you can expect her to fight, so be sure that you have an elder law attorney representing you.
This sounds like a very difficult and stressful situation you are going through. I'm not sure there are any easy answers. You should consult with an experienced elderlaw attorney who can help you determine what steps to take. From your question, it is not clear to me whether your parents are still competent to manage their own affairs or not. If negotiation doesn't work, You may be forced to seek a guardianship to appoint a responsible person to manage their finances, but this may be difficult if your parents are willing and able to oppose the action. Have you been to the house recently? If there has been no running water for 14 months, that is a serious issue and I would be concerned about what conditions your parents are living in. There are also protection of vulnerable adult statutes that you may want to consider if there is real abuse or neglect and you can't get any other resolution. You can view the AG's website for more information at http://www.atg.wa.gov/VulnerableAdultAbuse.aspx. You may also want to check with Senior Services or Senior Rights Assistance. They have many programs that may be of help to your parents.
This answer provides general legal information and should not be construed as legal advice to be applied to any specific factual situation. It is not intended to create and does not create an attorney-client relationship. The attorney writing this post is licensed in Texas and Washington only and the laws of your jurisdiction may differ.
Under the circumstances you may need to hire a lawyer to start a guardianship action. You can sign a petition for guardianship without asking to be named the guardian; in this case I would suggest you petition to have an independent Certified Professional Guardian ("CPG") appointed so that you cannot be accused of a self interest. Immediately upon filing the petition your lawyer will ask the court to appoint a Guardian ad Litem to investigate and report back to the court; such a report should reveal any financial or other abuse. Not all lawyers handle guardianships. Many members of the Washington Academy of Elder Law Attorneys handle guardianships; you can find such a lawyer at www.waela.org. Best of luck.