Tuesday, January 17, 2012

IRS Recently Revised Form 2848 - Power of Attorney

The IRS recently revised Form 2848, Power of Attorney and Declaration of Representative, and instructions. While the instructions to the revised form do not preclude using the prior version of the form, it is recommended that Tax professionals familiarize themselves with the revised form and begin using it.

Notable changes to Form 2848 include:

Part I -- Representatives/Notices and communications

 Line 2 of Form 2848 is to identify those individuals who are being authorized to represent the taxpayer. The information set forth on Line 2 includes the representative’s name, address, and other contact information. In addition to providing each representative’s Centralized Authorization File (CAF) number, the form now requests the preparer tax identification number (PTIN), where applicable.

In addition, Line 2 contains check boxes whereby two representatives  may receive copies of notices and other written communications. If the boxes are not checked, then the representatives will NOT receive copies of notices and other written communications the IRS sends to the  taxpayer.

Part I -- Acts authorized/Receipt of refund checks

Line 5 of the Form 2848 sets forth the authorized actions of a representative. The Form 2848 also contains certain actions that are not authorized to be undertaken by the representative unless specifically authorized by the taxpayer.

The actions that require specific authorization include substituting representatives, allowing the IRS to disclose tax return information to third parties, or signing certain returns. The revised Form 2848 contains boxes a taxpayer can check to indicate the taxpayer’s authorization for the representative to perform these actions.

Line 5 also makes clear that the representative is not authorized to receive or negotiate any amounts paid to the client in connection with representation, including refunds by either electronic means or paper checks.

Part I -- Identification/Signature of taxpayer 

Provides that if a joint return has been filed, each spouse must execute his or her own power of attorney

on a separate Form 2848 to designate a representative, even if the same representative is being appointed.

Part II -- Declaration of Representative  

 A new designation “(i)” has been added for “Registered Tax Return Preparer.” Additionally, the designations for student attorneys and student certified public accountants (CPA) have been combined into one designation “(k).”

The representative is also required to provide in addition to his or her licensing jurisdiction, the “License/Bar or Enrollment Number” where applicable.

The updated Form 2848 and corresponding instructions are posted on the IRS website.

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