DEFINITION of 'Specific Use'

Specific use is a type of authorization for an individual with power of attorney (POA) to discuss certain private tax matters with the Internal Revenue Service (IRS) on behalf of a taxpayer. Specific use items are outside the blanket of the Centralized Authorization File (CAF), a computerized system of records containing third party authorizations for the purpose of resolving federal tax issues. 

BREAKING DOWN 'Specific Use'

Specific use items may be related to applications for employer identification numbers (EIN), tax withholding certificates, refund claims or abatement requests, corporate dissolutions or liquidations, mortgage interest statements, Form 1099 matters, elections for small businesses to be treated as S corporations, and applications to adopt or change a tax year. Other examples of specific uses not recorded in the CAF are requests to disclose information to loan companies or educational institutions and to federal or state agency investigators for background checks.

IRS Form 8821 ("Tax Information Authorization") and Form 2848 ("Power of Attorney and Declaration of Representative") are where a taxpayer (or his or her representative) would check the "Specific use" boxes. The difference between Form 8821 and Form 2848 is that Form 2848 authorizes an individual to represent, or speak on behalf of, the taxpayer, whereas Form 8821 does not confer this legal authority. Form 2848 allows the representative to execute a request to disclose tax return information to a third party; execute waivers, consents and closing agreements; and argue for the taxpayer in disputes with the IRS.  The IRS does not record a power of attorney for a specific use in its CAF, so the representative with the power of attorney must bring Form 2848 to every meeting with the IRS. 

RELATED TERMS
  1. Special Power Of Attorney

    Special power of attorney is a written authorization that grants ...
  2. Attorney's Letter

    An attorney's letter serves as a verification for information ...
  3. Form 2848: Power of Attorney and ...

    Form 2848: Power of Attorney and Declaration of Representative ...
  4. Power of Attorney of Property

    Power of attorney of property is a legal document that transfers ...
  5. Private Letter Ruling - PLR

    A private letter ruling is an IRS interpretation of rules and ...
  6. Asset Specificity

    Asset specificity is the degree to which an asset can have use ...
Related Articles
  1. Managing Wealth

    Got a Financial Windfall? Hire the Right Attorney

    Selecting the right attorney will help you protect your assets when you receive a sudden windfall.
  2. Managing Wealth

    Why Keep Medical & Financial Powers of Attorney Separate?

    Representing your interests in financial matters is a very different job from communicating and advocating for your wishes with doctors.
  3. Financial Advisor

    Why Advisors Should Sidle Up to Estate Attorneys

    Financial advisors who building relationships with estate attorneys can better help all parties.
  4. Retirement

    10 Questions to Ask Your Estate Planning Attorney

    If you want what's best for your spouse and/or children, it's imperative that you ask an estate planning attorney the following questions.
  5. Retirement

    Power of attorney: When you need one

    Having a power of attorney ensures that you select who will act for you when you are unable to handle your affairs. Without one, the courts decide.
  6. Retirement

    Estate Planning You Must Have

    Understand what you need to know in your estate planning even if you don't have significant assets. Here are six essential things to have for successful planning and seamless asset transfer.
  7. Financial Advisor

    5 Tips for Cutting Divorce Costs

    A divorce can be difficult and expensive, but there are several ways for you to minimize some of costs associated with the process.
  8. Small Business

    What's The Cost To File A Patent?

    When filing a patent, be ready to pay attorney fees, filing fees and other related expenses. Usually the total bill is a few thousand dollars.
  9. Retirement

    Are Do-it-Yourself Online Wills Right for You?

    An online will site can be an inexpensive and fast way to get that all-important will completed. Find out if this is the right solution for your situation.
  10. Retirement

    Have This Conversation Before It's Too Late

    As Baby Boomers continue to retire, age and pass, it's important for Millenials talk to them about their estate and financial plans.
RELATED FAQS
  1. What do real estate attorneys do?

    Understand the role of a real estate attorney, professionals specialized in legal matters related to property, to help you ... Read Answer >>
Hot Definitions
  1. Economies of Scale

    Economies of scale refer to reduced costs per unit that arise from increased total output of a product. For example, a larger ...
  2. Quick Ratio

    The quick ratio measures a company’s ability to meet its short-term obligations with its most liquid assets.
  3. Leverage

    Leverage results from using borrowed capital as a source of funding when investing to expand the firm's asset base and generate ...
  4. Financial Risk

    Financial risk is the possibility that shareholders will lose money when investing in a company if its cash flow fails to ...
  5. Enterprise Value (EV)

    Enterprise Value (EV) is a measure of a company's total value, often used as a more comprehensive alternative to equity market ...
  6. Relative Strength Index - RSI

    Relative Strength Indicator (RSI) is a technical momentum indicator that compares the magnitude of recent gains to recent ...
Trading Center