IRS Publication 947: IRS Representation and Power of Attorney
Understand the formal process for authorizing a professional to handle your IRS tax matters, ensuring you grant the correct level of authority.
IRS Publication 947, “Practice Before the IRS and Power of Attorney,” is the Internal Revenue Service guide for taxpayers who wish to authorize a professional to represent them in tax matters. This publication details the regulations for granting an individual the authority to communicate with the IRS, access confidential records, and act on a taxpayer’s behalf.
Who Can Represent a Taxpayer
The IRS specifies categories of professionals who are permitted to represent taxpayers. Individuals with unlimited representation rights can perform a wide range of actions, including communicating with the IRS on any tax matter, representing the taxpayer at conferences, and signing agreements. This group includes attorneys in good standing with a state bar, Certified Public Accountants (CPAs) qualified to practice, and Enrolled Agents (EAs). EAs are individuals who have passed a comprehensive IRS test on taxation or have qualifying experience as a former IRS employee.
The standards of conduct and ethical obligations for these representatives are outlined in Treasury Department Circular No. 230. This circular sets forth the rules governing practice before the IRS, addressing duties, restrictions, and sanctions for misconduct.
Some individuals have limited representation rights. For instance, certain unenrolled tax return preparers who participate in the IRS Annual Filing Season Program may represent taxpayers only for the returns they prepared and signed. Their representation is confined to examinations before revenue agents, customer service representatives, and the Taxpayer Advocate Service. They cannot represent taxpayers before the IRS Appeals Office, handle collections issues, or sign certain agreements.
Authorizing Representation with Form 2848
The primary document for authorizing representation is Form 2848, Power of Attorney and Declaration of Representative. This form legally appoints a qualified individual as your agent before the IRS.
In Part I, the taxpayer must provide their complete personal information, including name, address, a daytime telephone number, and a taxpayer identification number (SSN or EIN). The name and address on the form must match the information on file with the IRS for the specified tax periods to avoid processing issues.
The next section is for listing the appointed representative(s). For each professional, you must include their full name, address, Preparer Tax Identification Number (PTIN), and Centralized Authorization File (CAF) number. The CAF number is a unique nine-digit number the IRS assigns to representatives to help track authorizations.
In the “Tax Matters” section, the taxpayer must specify the scope of representation. This includes the type of tax, the tax form number, and the specific years or periods covered. Vague descriptions like “all years” or “all taxes” are not accepted by the IRS.
The “Acts Authorized” section grants general authority, allowing the representative to receive confidential tax information and sign agreements. If a taxpayer wishes to withhold certain powers, such as the ability to sign a tax return or substitute another representative, they must list these deletions on the form. Any specific authorities not covered by the general grant must also be detailed.
Submitting a Power of Attorney
After Form 2848 is completed and signed by both the taxpayer and representative, it must be submitted to the IRS. The form should not be filed with your tax return unless it relates to a specific issue with that return. Instead, it should be mailed or faxed to a dedicated IRS service center, with the correct location detailed in the form’s instructions.
The IRS processes the Power of Attorney and records it on the Centralized Authorization File (CAF). The CAF system links the representative’s CAF number to the taxpayer’s account, ensuring future correspondence for those tax matters is directed to the representative.
Processing can take several weeks, after which the representative is officially recognized by the IRS. A taxpayer can revoke a Power of Attorney by sending a written revocation to the IRS or by submitting a new Form 2848 with a different representative for the same tax matters.
Understanding Tax Information Authorization
A related document is Form 8821, Tax Information Authorization (TIA), which is more limited than a Power of Attorney. A TIA does not grant representative power; it only allows a designated individual or organization to inspect and receive confidential tax information for specified tax matters and periods.
The designee on Form 8821 cannot represent the taxpayer before the IRS, meaning they cannot speak in meetings, sign agreements, or advocate on the taxpayer’s behalf. The authority is limited to accessing tax records, such as returns, transcripts, and notices.
A TIA is useful when a third party, like a mortgage lender or financial planner, needs to verify tax information without engaging with the IRS. Completing Form 8821 requires taxpayer identification, designee information, and a description of the tax matters. Unlike a Power of Attorney, the designee does not need to be qualified to practice before the IRS and does not sign a declaration.