How to Authorize an IRS Third-Party Designee

Authorizing a third-party designee on your tax return permits another individual to communicate with the Internal Revenue Service (IRS) about that specific filing. This limited authorization allows a trusted person to handle simple inquiries that may arise during the processing of your return. It is a temporary grant of authority, distinct from more comprehensive forms of representation, designed for convenience and to resolve minor issues efficiently.

Scope of a Designee’s Authority

The third-party designee can be any individual the taxpayer trusts, including a friend, family member, or the paid tax preparer who completed the return. This person does not need to be a tax professional. The designee’s function is to ask the IRS for information about the status of the return or a potential refund.

A designee is also permitted to provide the IRS with information that might be missing from the tax return. For instance, if an IRS employee has a question about an entry, they can contact the designee to clarify the matter. The designee can also request and receive copies of notices or transcripts related to that specific return. This authority is temporary, automatically expiring one year from the original due date of the tax return.

There are significant limitations to what a designee can do. Their authority is strictly confined to the single tax form and tax period for which they are designated, and they cannot discuss tax matters from other years. A designee is not permitted to receive a taxpayer’s refund check or have it deposited into their own account. They cannot bind the taxpayer to any liability or represent them in serious matters like an audit or collection issues.

Required Information for Authorization

You will need the designee’s full legal name and a current phone number. A central component of the authorization is a five-digit Personal Identification Number (PIN) that you create for this purpose. This PIN is for the designee to use as identification when speaking with the IRS and is not the same as the taxpayer’s Identity Protection PIN (IP PIN) or the self-select PIN used for e-filing. The taxpayer can choose any five numbers for the designee’s PIN.

Completing the Authorization on Your Tax Return

The process of granting third-party designee authority is integrated into individual income tax forms, such as Form 1040. The section is typically found near the bottom of the second page, directly above the taxpayer signature line.

To grant the authorization, you must locate the “Third-Party Designee” section on your tax form. You will see a question asking if you want to allow another person to discuss this return with the IRS, and you must check the “Yes” box to proceed.

After checking “Yes,” you will fill in the designee’s name, their telephone number, and the five-digit PIN you have selected. Once this information is entered and the return is signed, the authorization becomes active upon the IRS’s acceptance of the filed return. No separate form is needed for this authorization.

When Formal Representation is Needed

The third-party designee authorization is limited and not suitable for all situations. When tax matters become more complex, involve past or future tax periods, or require formal advocacy, a higher level of authority is necessary. These situations require specific IRS forms that grant more extensive powers.

For issues such as an audit, responding to collection notices, or handling an appeals process, a taxpayer needs to file Form 2848, Power of Attorney and Declaration of Representative. This form allows a qualified individual, such as a Certified Public Accountant (CPA) or attorney, to represent the taxpayer before the IRS and take substantive actions on their behalf.

If a taxpayer wants to authorize a third party only to receive and review their confidential tax information without granting representative powers, they would use Form 8821, Tax Information Authorization. This form allows the designated person to inspect tax records for the tax years specified, but it does not permit the appointee to speak for the taxpayer or resolve disputes.