If you want someone to interface with the Internal Revenue Service (IRS) on your behalf, you'll need to take the formal action required to grant authority for this purpose. The authorization to share information and to allow someone else to deal with the IRS for you is made on Form 2848: Power of Attorney and Declaration of Representative.
Your tax information is private. After all, it contains sensitive information including your name, address, date of birth, and your Social Security Number (SSN). You should never share it with anyone, unless, of course, there's a very good reason to do so.
At the same time, the IRS isn't able to share that information with others either. The agency can only share it with a third party if you authorize it to do so. You may, for example, hire a tax attorney to represent you in an audit. Read on to understand what signing Form 2848 allows someone representing you to do.
- Form 2428 allows tax professionals, such as an attorney, CPA or enrolled agent, to represent clients before the IRS as if they were the taxpayer.
- Signing Form 2848 and authorizing someone to represent you does not relieve a taxpayer of any tax liability.
- Signing the the form does not grant authority to do everything when it comes to your taxes on your behalf.
What Does Form 2848 Authorize?
Signing Form 2848 does not relieve taxpayers of any tax liability. It gives your agent—a certified public accountant (CPA), attorney, or other individual designated as your agent—the authority to take certain actions on your behalf. These include:
- Receiving confidential tax information.
- Performing acts that you are able to do, such as signing an agreement with the IRS regarding taxes on returns specified on Form 2848.
- Signing a tax return in limited situations, such as if you are suffering from a disease or injury or you are continually outside the U.S. for at least 60 days before the date that a return is required to be filed. In any other circumstance you must submit a request in writing to the IRS for permission for someone (for example, the preparer) to sign your return.
The form is not a blanket grant of authority to do everything when it comes to your taxes on your behalf. For instance, your agent cannot:
- Endorse or negotiate a refund check, or direct that a refund be deposited electronically into the agent’s account.
- Substitute another agent. However, you can specifically authorize this.
If you want someone merely to see your tax information but don't want to authorize them to represent you before the IRS, you can sign Form 8821: Tax Information Authorization instead. This might be the case if you apply for a mortgage and need to share your tax information with the lender, for example.
Filing Form 2848 does not revoke authority to see tax information that you gave by filing Form 8821.
How to Fill Out Form 2848
In order for Form 2848 to be effective, you have to specify the tax form and year for which you are granting authority. This includes:
- The description of the matter (for example, income taxes).
- The tax form number. For example, if you want to authorize your agent to deal with your standard tax return form with the IRS, you would denote Form 1040. Keep in mind that saying "all forms" is not sufficient.
- The year or period of applicability. Saying "all years" or "all periods" is not sufficient.
You also have to provide information about your agent/representative. This includes:
- Name, address, telephone number, and fax number.
- Preparer Tax Identification Number (PTIN), which is a preparer tax identification number that must be renewed by CPAs, attorneys, enrolled agents, and paid preparers annually.
- Centralized Authorization File (CAF) number, which the IRS uses to identity the representative. This is a nine-digit number assigned by the IRS the first time a third-party authorization such as Form 2848 is submitted. If this is your agent’s first designation as a representative, there won’t be any CAF number to enter.
You have to sign the form. If you filed jointly and each spouse wants to grant authority, each must file a separate Form 2848 to designate a representative. Although you may have filed jointly, this doesn't mean that you have to use the same representative.
All pages of Form 2848 are available on the IRS website.
Using a Non-IRS Power of Attorney Form
If you have your own, non-IRS power of attorney (POA) form that you’ve signed to give an agent various powers to act on your behalf, it can be used in lieu of Form 2848 under specific conditions. Remember, a POA is legal document that gives one agent the power to act on your behalf, and is generally used when someone is ill or disabled and can't otherwise take care of their own financial situation.
Your POA must:
- Authorize your agent to act in tax matters. If the POA is a blanket grant of authority, no specific grant of authority in tax matters is necessary, but the POA cannot restrict your agent’s actions in tax matters.
- Contain all the information required in the government’s form.
Alternatively, your agent, acting under your own power of attorney form, can sign Form 2848 on your behalf.
Revoking a Power of Attorney
There may come a time when you may want to change agents—like when you hire a new CPA because you aren’t happy with the representation of the CPA to whom you originally gave authority. You must complete a new Form 2848. Filing a form for a new agent automatically revokes a former POA as long as the previous agent is in the CAF system. This is why that number assigned to your agent is important.
If you are merely adding a new POA and not revoking a former one, you must indicate this by checking the box on line 6 on Form 2848. Also attach a copy of the former Form 2848 with the new form.