Her Father Can No Longer Handle His Taxes. The IRS May Not Accept the Power of Attorney His Lawyer Drew Up Without Its Own Form Attached

If a family lawyer drew up your power of attorney, the IRS may not accept it, and this piece explains why. A common case involves a daughter who calls the IRS about a letter her father received and is told the agency can’t discuss his account with her.

She holds his durable power of attorney, which is a legal document that remains in effect if he loses mental capacity. The IRS still won’t act on it until it has its own form on file. A recent 24/7 Wall St. piece covered banks that refuse a power of attorney, and the IRS faces the same problem.

Why a Lawyer’s Document Can Stall at the IRS

For this purpose, the IRS uses Form 2848, Power of Attorney and Declaration of Representative. Under 26 CFR 601.503(b)(2), the IRS will accept a power of attorney other than Form 2848 if it contains the required information.

To get it into the Centralized Authorization File, IRS database phone agents check who’s authorized, and they must attach a completed Form 2848. In that setup, the lawyer’s document remains the active power of attorney, and the father doesn’t need to sign the 2848. The representative still has to sign the Declaration of Representative.

The required information under 26 CFR 601.503(a) includes the taxpayer’s name, mailing address, and taxpayer identification number, the representative’s name and address, and a description of the matters covered. That description has to list the type of tax, the federal form number, and the specific years. Many general powers of attorney just say the agent can perform “any and all acts.” The IRS will not accept a power of attorney missing the items in (a)(1) through (5).

A Fix That Works After He Can No Longer Sign

Under 26 CFR 601.503(b)(3), the person named in the lawyer’s document can fill the gaps by signing a Form 2848 on the taxpayer’s behalf that includes the missing details, then attaching it to the original. Two conditions apply. The original document has to cover federal tax matters, and broad “any and all acts” language counts.

The agent must also attach a statement, signed under penalty of perjury, that the original is valid under state law. When there’s no power of attorney, a guardian or conservator appointed by a court signs for the individual and files Form 56, the Notice Concerning Fiduciary Relationship. Under 26 U.S.C. § 6903(a), that fiduciary takes on the taxpayer’s tax rights and duties.

Who Can Be Named, and When Viewing Access Is Enough

A Form 2848 representative has to be eligible to practice before the IRS. Attorneys, CPAs, and enrolled agents are in that group, plus someone with a special relationship to the taxpayer, such as a member of his or her immediate family. Form 8821, Tax Information Authorization, allows a person to see and receive confidential tax information without representing the taxpayer. That can be enough when a relative only needs to read notices.

Under Pub. 17, an agent can sign his return only if the taxpayer can’t sign because of disease or injury, has been outside the U.S. for a continuous period of at least 60 days before the due date, or has IRS permission. The power of attorney attached to the return has to grant that authority.

What Changes After a Death

A personal representative, meaning an executor, administrator, or anyone in charge of the deceased taxpayer’s property, files the final return and checks the “Deceased” box. A surviving spouse filing jointly just files the return to get the refund. A representative appointed by a court includes a copy of the appointment certificate. All other filers attach Form 1310. Our recent piece on the IRS Identity Protection PIN covers a related issue that can come up when handling a parent’s filings.

Setting It Up While He Can Still Sign

1. He signs Form 2848 naming a family member or tax professional, with “Income,” Form 1040, and specific years listed. Line 5a includes a box for “Sign a return”.
2. A separate Form 8821 can cover a relative who only needs to see his records.
3. Copies go in the same file as the general power of attorney.
4. You can submit it at IRS.gov/Submit2848, which requires a Secure Access account, or by fax or mail. Tax professionals can also use the IRS Tax Pro Account, where most requests are recorded right away.

Details That Get Forms Rejected or Overridden

A new Form 2848 automatically revokes all earlier powers of attorney on file for the same matters and years unless the line 6 box is checked and a copy of the old one is attached. The IRS sends notices to only two representatives. Each taxpayer needs a separate form, so spouses who filed jointly each sign their own. The form will not be honored for any purpose other than representation before the IRS, so banks and brokers still rely on the general document. An unsigned or undated form goes back to the taxpayer.

A Form 2848 signed by the father while he can still sign it himself places the named representative on the Centralized Authorization File that phone agents check.

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