IRS Form 2848: A Guide to Power of Attorney for Tax Matter

IRS Form 2848, Power of Attorney and Declaration of Representative, is a form required when any individual or business organization provides the power to someone else to represent them before the IRS. In some situations, individual or business organizations need the help of professionals such as attorneys or accountants to handle your tax matters. Some of the key responsibilities of the designated representative include responding to IRS notices, tax negotiations, and settlements, and also accessing confidential tax information. The following section explores different aspects of IRS Form 2848 in detail.

What is IRS Form 2848 Used for?

Managing tax complications often becomes a daunting task for both business organizations and individuals. For instance, managing tax regulatory compliance hassles often becomes cumbersome for business organizations. A designated representative generally possesses the professional expertise to handle such tax compliance on your behalf. It allows you to come out to tax implications faster as professionals possess negotiation skills that are often challenging for individuals or organizations. Some of the situations when you need to grant power of attorney for tax matters are:

• Tax Disputes and Negotiations: Managing tax disputes is a major challenge for businesses and also individuals. However, failing to resolve tax disputes can lead to dire legal consequences. To avoid such penalties, providing the power of attorney to tax professionals is beneficial. They possess the professional skills to handle tax debts, penalties, and installment agreements.
• IRS Audits and Inquiries: Responding to IRS audits and inquiries requires professional skills that business owners or individual taxpayers lack. Power of attorney is often granted to professionals who can communicate with the IRS.
• Convenience: When business owners or individuals are not available for tax filing, power of attorney is granted to professionals to handle tax filing and negotiation with the IRS.
• Professional Guidance: Power of attorney is also granted to CPAs, tax attorneys, and enrolled agents for professional guidance. These agents have a proper understanding of tax laws and IRS procedures that the corporate businessman or individual lacks. As a result, seeking their guidance makes the tax process smooth and secure.

Professionals Who Can be Granted POA

Not everyone can be authorized with IRS Form 2848. IRS has provided clear instructions on who can be granted the POA. They are:

• Certified Public Accountants (CPAs)
• Enrolled Agents (EAs)
• Enrolled Actuaries
• Attorneys
• Family members (in limited cases)
• Officers of a corporation, partners, or fiduciaries representing an entity

Instructions on How to Fill Up the IRS Form 2848

It is crucial to fill up the IRS Form 2848 accurately as per given instructions to ensure that your representative has complete authority. The step-by-step guide is given below:

Section 1 Information of Taxpayer

• In the first section, you need to provide the details of your biodata. Mention the correct name, address, SSN, or Employer Identification Number for business purposes. Make sure all the entries are correct to avoid disputes later on.
• Provide a Valid Phone Number

Section 2 Representative Information

• In the next section provide the biodata of your chosen authorized representative. Include the correct name address, and phone number
• Make sure your representative has a Preparer Tax Identification Number (PTIN) or a Centralized Authorization File (CAF) number (assigned by the IRS).

Section 3 Tax Matters and Periods

• Mention the types of tax matters such as income tax or payroll tax that your representative needs to handle.
• Specify tax periods or years

Section 4 Acts Authorised

• Mention any specific limitations or special responsibilities of your representative.
• If you appoint your representative to handle only payment plans but not for tax returns then that should be mentioned.

Section 5 Revocation or Retention of Previous POA

In case anyone files a new IRS Form 2848, by default it cancels out previous authorizations. However, there will be an option for you in the form to mention that you want to work with a previous POA. You must also attach the required copy to specify your choice.

Section 6 Signature

• The last step is to sign the form. The taxpayer must sign and date the form.
• The POA must sign and mention their professional credentials.

You can send the form to the IRS via a registered email ID, a region-specific fax number, or through the IRS e-service portal. Make sure you fill up the form perfectly as the IRS retains the authority to cancel out incorrect forms. Lastly, Form 2848 does not allow signing for tax filing unless the taxpayer is ill due to disease or disability.

Conclusion

The blog has discussed the importance of IRS Form 2848 and provides a detailed guide on how to fill out the form. Hope this proves insightful for you. Make sure you hire Top tax compliance services who possess the required skills to resolve tax implications on your behalf. An inefficient POA would further jeopardize your tax situation and might lead to further complexities.