Dealing with the IRS is rarely easy. Procedures may not always be clear, and laws can get complicated fast. Communications can be especially difficult if you are being audited, have an unpaid tax balance, or are facing a court summons regarding your taxes.
You have the option of authorizing a qualified tax specialist to represent you before the IRS if you find yourself overwhelmed by a challenging tax situation. Just complete and submit a special tax form known as IRS Tax Form 2848 to empower them to fight for you.
This guide will cover what Form 2848 is, frequently asked questions, reasons you may need to file one, and how to go about submitting it.
What Is Form 2848 and How Is It Used?
Commonly known as power of attorney, or POA, Form 2848 is a two-page IRS tax form that authorizes a qualified person to represent you before the IRS. By submitting Form 2848, you give permission for an eligible individual to examine your tax information. The IRS provides guidelines regarding Form 2848, noting that your representative must be an eligible person, such as a tax attorney or CPA:
“Use Form 2848 to authorize an individual to represent you before the IRS. The individual you authorize must be a person eligible to practice before the IRS. Your authorization of a qualifying representative will also allow that individual to receive and inspect your confidential tax information.” – United States Internal Revenue Service (IRS)
Common FAQs About IRS Form 2848
Power of attorney (POA) is not something you should give without fully understanding what it means. The recipient should be someone you trust completely because this is a power that can be abused. Here are a few common questions (and answers) to help you understand what this form is used for and how it works.
1. What Is Form 2848?
Commonly known as a power of attorney, Form 2848 is a two-page document that authorizes a qualified person to represent you in dealings with the IRS. By submitting the IRS Power of Attorney Form 2848, you grant permission for an eligible individual to examine your tax information. The IRS states that your representative must be an eligible person, such as a tax attorney or CPA, who will receive and review your confidential information.
2. How Is Form 2848 Used?
Form 2848 allows you to specify an individual who can receive confidential tax information about you. You might do this because you need assistance from a tax attorney with an audit, if you have a health issue preventing you from taking care of these matters on your own, or for your own reasons. It is important to recognize that your tax information includes sensitive personal information, such as your Social Security number, address, and date of birth, so you need a trustworthy representative.
3. What Kinds of Things Can a Power of Attorney Do?
Your designated POA may take on acts such as signing agreements in your name, receiving personal tax information, signing consents or waivers, or negotiating about tax matters on your behalf. This person can essentially make financial decisions for you and see the information needed to inform those judgments.
4. What Is Not Included as Power of Attorney?
The POA cannot substitute or add someone else as your representative, nor can they request that tax return information be disclosed to a third party unless they are specifically authorized to do so. They are also unable to access IRS records through an Intermediate Service Provider.
5. Can I Revoke the POA at Any Time?
Yes. To revoke a power of attorney that has been executed, you need to write “REVOKE” across the top of the first page and sign and date below this change. The annotated version must then be mailed or faxed to the IRS. If you no longer have the original document, you must send the IRS a statement of revocation to indicate that you are revoking the POA. This statement must also list all relevant matters and years being revoked (or write “remove all years/periods” if revoking all authority), as well as the name and address of the POA you are revoking. Sign and date the statement.
6. Who Can I Designate as Power of Attorney?
You must name a representative who is considered an eligible individual by the IRS. The representative must be one of the following:
- Attorney
- Certified public accountant (CPA)
- Enrolled agent (by the IRS)
- Offered by a taxpayer organization
- Full-time employee of the taxpayer
- Immediate family member (spouse, parent, child, grandparent, grandchild, step-parent, step-child, brother, or sister) of the taxpayer
- Enrolled actuary
- Unenrolled return preparer
- Qualifying student or law graduate who has received permission to represent taxpayers
- Enrolled retirement planning agent
Only these individuals may be named as representatives on Form 2848. Note that representatives such as family members may not be able to have complete access or signing privileges as a certified tax professional would.
7. Does Form 2848 Relieve Me of Tax Liability?
No. The taxpayer is still liable for all matters with the IRS. The representative simply acts on your behalf when appearing before the IRS or signing and reviewing agreements.
Another commonly asked question is why a taxpayer would need to file Form 2848 in the first place. It can be an important tool in several likely scenarios.
What Are the Top 6 Reasons to File Form 2848?
There are multiple reasons why taxpayers file Form 2848. In most cases, the form is warranted when a taxpayer needs assistance filing their taxes or when tax troubles strike. Some specific reasons why you may need to file Form 2848 are as follows:
1) You Are Being Audited
It can be alarming to hear from the IRS that you will be audited – especially if you already struggle with preparing your taxes. Most IRS audits are conducted by mail, though the audit may also be conducted at an IRS office in your area.
An IRS auditor may pay a visit to your home to gather more information, but it’s rare these days. You will boost your odds of a favorable outcome, regardless of the type of audit you are facing, if you seek the guidance of a tax lawyer or CPA and file Form 2848.
2) You Have an Unpaid Tax Balance
“If you owe back taxes and don’t know how you’re going to pay the debt, the FTC, the nation’s consumer protection agency, says don’t panic, take a deep breath, and consider your options.” – United States Federal Trade Commission (FTC)
Owing back taxes can be stressful. Fortunately, you may be eligible for options such as an installment agreement or Offer in Compromise (OIC). But deciding which option to take and negotiating on tax matters is intimidating for a lot of people.
A skilled tax lawyer can help you decide how to best proceed and can handle communications with the IRS. However, you will need to submit Form 2848 to give your lawyer access to your tax information.
3) You Have to Go to Tax Court
Much like an audit or back taxes, the prospect of going to tax court is unnerving. Many people who are summoned to tax court have a tax deficiency or related unresolved matter. Further, many cases are settled before trial, in large part because taxpayers often hire tax attorneys to help ensure that their cases proceed as quickly and affordably as possible.
4) Your Health or Well-Being Is Compromised
Health complications may interfere with your ability to file your taxes accurately and in a timely fashion. If your eyesight is impaired or you are not able to fully function, a power of attorney allows a qualified person you designate to access your information and represent you before the IRS. If your health improves and you no longer wish to grant an agent access to your taxes, you can revoke a previously submitted form.
5) You Want a Professional to Manage Your Taxes
“Most CPA tax practitioners regularly use a Form 2848, Power of Attorney and Declaration of Representative, to represent their clients…Practitioners may withdraw an authorization at any time.” – Susan C. Allen, CPA/CITP, CGMA, Journal of Accountancy.
One of the most common reasons people file Form 2848 is to ensure that their taxes are prepared by an experienced tax professional. Whether you feel uncomfortable preparing your own tax return or you simply want to make sure you avoid errors, you can fill out Form 2848. Your authorization can be withdrawn at any time for your security.
6) Your Tax Situation Is Suddenly More Complicated
Receiving a large inheritance, getting divorced, or selling property can add to the complexity of your tax situation. When an unexpected life change occurs, it often has an impact on the taxes you pay.
A simple filing mistake could end up costing you thousands of dollars and may even lead to an audit. Rather than try to navigate through these changes on your own, you may decide to complete Form 2848 and enlist the help of a tax expert.
How and Where to File Form 2848
Taxpayers can download Form 2848 on the IRS website and complete it by hand by printing it out and mailing it in. The form can also be completed digitally in the provided PDF format. Here’s what you need to know:
- Follow all instructions on the form closely and ask a tax professional to review it to ensure accuracy and completion.
- The IRS website has a list of addresses and fax numbers where you can send your completed Form 2848, depending on which state you live in.
- You may also submit your form online as long as you did not check the box on line 4 of the form (“Specific use not recorded on the Centralized Authorization File [CAF]”).
- If this box is checked, the form must be mailed in or faxed.
- The IRS has an online portal to submit Form 2848 by logging in to your account, answering a few questions about the form, and uploading your completed and signed Form 2848.
- Do not submit the form in multiple formats (i.e., if you mailed it in, do not submit it again online).
- You may only submit one form at a time through the system.
Taxpayers who submit the form online will need to sign it electronically. The IRS accepts electronic signatures via several methods, including:
- A typed name in the signature block
- A digitized version of a handwritten signature
- A handwritten signature using an electronic signature pad or stylus device
- A signature created by third-party software
Make sure you sign the form in a reliable format. You should receive a confirmation email after you complete the form, sign it, and submit it online. This quick confirmation is a big benefit of submitting online, and the process can move a lot faster.
Be careful about following these guidelines when submitting the form. A tax professional will help and make sure you follow all the necessary protocols.
Need Help Filing Form 2848?
Sometimes the reasons to file Form 2848 or the steps you have to take are not crystal clear. The best way to determine whether you should file Form 2848 is to seek the expertise of an IRS tax lawyer. With the help of a trusted tax attorney, you can approach your taxes with confidence knowing that you are complying with IRS requirements.
The experts at Silver Tax Group are here to answer your questions about IRS Form 2848 and any other tax-related matters. We assist clients from across the country with emergency tax assistance, criminal tax defense, offshore assets, accounting, and tax consulting, streamlined installment agreements, and IRS audit help. Contact us today with any tax-related questions you may have.
