Power of Attorney Form Submission to the IRS - What You Need to Know

You may have heard about an estate planning tool called Power of Attorney. This allows you to appoint another individual to manage your affairs in a legal manner. This can range from managing your business affairs to your personal affairs. But what does that actually look like in practice? In order for it to work, Power of Attorney requires that you obtain the right levels of access, control, and authorizations for this person. 

For instance, the Internal Revenue Service (IRS) won’t discuss your taxes with just anyone. If you want a representative to be able to talk about your taxes with them, you need to provide authorization. This is where the IRS Form 2848 comes in. Keep reading to find out what the Power of Attorney Form IRS is used for, if you need one, and how to submit it. 

What is the Purpose of IRS Form 2848?

The purpose of the IRS Form 2848 is to authorize another individual to represent you when speaking to the IRS. The form is titled “Power of Attorney and Declaration of Representative.” Without any authorization, the IRS will protect your privacy. They will not speak to another individual about your taxes or your identity unless you have given express authorization.

When you set up a Power of Attorney, you appoint another adult to act on your behalf. Let us refer to this person as your “agent.” Outside organizations and entities will not know that you have an agent unless you tell them and provide permission for them to handle your affairs on your behalf. For instance, you will need to submit your Power of Attorney document and identification forms to your bank such that your agent can pay your bills and manage your finances.

It is very much the same with the IRS. The Form 2848 (also called the IRS Power of Attorney Form) is how you would authorize the IRS to allow your agent to handle your tax matters. 

What is a Form 2848 Used For?

A Form 2848 is used when you want to grant your Power of Attorney agent to work with the IRS on your behalf. Here are some activities that they could conduct with the IRS once authorized:

• Sign forms and documents on your behalf

• Negotiate payment plans if needed

• Receive and respond to IRS notices on your behalf

• Access records and transcripts in your IRS account

• Work with the IRS to appeal a dispute

When Do You Need IRS Form 2848?

The IRS won’t grant power of attorney for just anyone. Immediate family members will be authorized, but you can also use Form 2848 to authorize certain individuals and professionals who need to deal with the IRS for you. 

Here are some examples of individuals you might grant IRS Power of Attorney using the Form 2848:

• The agent named in your Estate Plan’s Power of Attorney

• Your CPA 

• Your lawyer

• Agents, actuaries, and tax return preparers

• Corporate officers of your business

• Retirement plan agents (solely for retirement plan tax issues)

You may be wondering what scenarios may cause you to appoint an IRA Power of Attorney. Here are some examples:

• When you want to give your tax professional full access if you’re being audited by the IRS

• If you’re experiencing a physical condition or medical issue that prevents you from communicating with the IRS

• If you have tax debt that needs to be negotiated by an attorney

What is the Difference Between IRS Form 8821 and 2848?

So far, you’ve learned how Form 2848 can be used to give Power of Attorney to another individual so that they can represent you before the IRS. There is a second form you should know about, which is IRS Form 8821. This Tax Information Authorization form can be used when you want to allow another individual to receive and analyze your private tax information without representing you. More simply, it’s best to use Form 8821 if you just need for someone to be able to see your tax information, such as a mortgage lender.

Does Form 2848 Need to be Notarized?

Form 2848 does not need to be notarized. However, the person submitting the form is required to authenticate their client’s identity if they do not have a personal or business relationship with them. The purpose of authentication is to make sure the person is who they claim to be. This can be done by inspecting their government-issued identification, previous tax returns, utility bill, etc.

Another common question is, “can Form 2848 be signed electronically,” and the answer is yes.

Taxpayers who want to complete Form 2848 online with electronic signatures can do so. They would need to complete the form, and collect all parties’ signatures. Per IRS instructions, these can be ink signatures or electronic signatures. 

According to the instructions, acceptable forms of electronic signatures include:

• Names that are typed in the designated space for signatures

• An original signature that is scanned or digitized and then placed upon the form

• A handwritten signature inputted electronically by using a signature pad

• A handwritten signature inputted electronically by using a screen or stylus

• An electronic signature created by a third-party software (such as DocuSign)

Once the form is complete with signatures, the form can be submitted online through the IRS website.

How to Submit a Power of Attorney to the IRS

Last but not least, it’s helpful to know how to submit your IRS Power of Attorney form. Follow these simple steps to execute this process:

1. Visit the IRS website and download Form 2848

2. Review the instructions provided by the IRS on how to use Form 2848

3. Fill out the form by printing it out and using a pen, or by filling it out electronically

4. Sign and date the form in Section 7, “Taxpayer declaration and signature”

5. Send the form to your agent, such as your CPA, attorney or family member to fill out and sign Part II of the form.

6. Verify that the form is complete and includes all required signatures. If signatures are electronic, verify that they satisfy the IRS electronic signature requirements.

7. Visit Irs.gov/Submit2848 to submit your form online. (Click “Log In to Submit.”  If you haven’t before, you will need to create a new Id.me account with the IRS.

Update Your Power of Attorney Today

When we discuss estate planning, we often talk about the various documents, designations, and roles that go into the Estate Plan itself. For instance, we often talk about different types of Power of Attorney, and how to choose the right one for you. 

However, it’s also helpful to know what type of tasks you need to execute to make sure your Estate Plan works in practice, and not just in theory. It’s great if you appoint an agent in your Power of Attorney document, but it’s not very effective if you don’t follow through and make sure that agent has the necessary authorizations to carry out their duties.

The Power of Attorney Form IRS is a great example of this. By filling out and submitting the necessary forms with the IRS, you’re making sure that your agent is authorized to conduct your tax matters on your behalf. This can go into effect if you were to become incapacitated. You can also give your CPA power of attorney with the IRS to conduct your tax affairs on your behalf, even when you’re in perfect health! That doesn’t sound too bad, does it?

If you are thinking about submitting a Form 2848 with the IRS, it’s also a great time to review your estate planning documents. You’ll want to make sure that any Powers of Attorney you grant to external entities line up with the agents you’ve named in your Estate Plan POA document. Not sure where to begin? We include Power of Attorney in both our Trust and Will packages. Click here to take our quiz and find out which one is the right fit for you! 

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