I gave a Power-of-Attorney to My CPA and Never Had to Speak with the IRS Again. Thank You!!

by Tom Buck

Kleenex-in-studioMost experienced IRS problem solvers agree that the less direct contact the taxpayer has with the IRS the better. There is a special IRS form that allows any taxpayer to file for the purpose of appointing an expert to represent their interests.

IRS Form 2848, Power of Attorney and Designation of Representative (known in the vernacular as POA), provides a means by which a taxpayer may authorize a representative who holds a certain credential (attorneys, CPAs and Enrolled Agents [EAs] qualify) to “stand in his/her shoes”.

In other words the IRS is required, by law to treat me, your POA representative, as though I were you.

In my practice we take it from the initial gathering of information about the IRS problem being presented right on through negotiating your case with the IRS and going through the Appeals process. The POA makes all of this possible.

There are a couple of things that a POA accomplishes. First, it authorizes the IRS to communicate with me as your POA representative. You will continue to receive all written communications from the IRS. I will also receive a copy.

An interesting aside here – many of you are probably old enough to remember when the federal government adopted the “Paperwork Reduction Act” in which all government agencies were required to cut down on the amount of paper they used. Here is an example of how the IRS did in reducing paperwork for the past few years .

Before the “Act” was passed I would receive, as POA holder, one copy of the correspondence sent to the taxpayer. This envelope always contains several pages of information regarding appeals right and other ways to protest – I don’t need ANY more copies of this material, but IRS will continue to “reduce” their use of paper in this fashion.

At present, we receive TWO copies of every piece, one for each spouse (the majority of our problem solving clients are married). In the past we were allowed to have both spouses sign one POA if they filed a joint return. Now each spouse must sign a separate POA.

Therefore, because the IRS changed the rules of POAs filed by a married couple, they are now sending out more than twice as much paper.

Is there anyone out there who has NOT felt some degree of frustration (or worse?) when dealing with a government bureaucracy? The IRS is a bureaucracy numbering nearly 100,000 employees. In another lifetime, I was employed by a state government agency. I saw a governmental agency grow from five employees to over thirty in a matter of two or three years.

It is not unusual for a department head to feel the need to build his/her stature by overseeing a greater number of employees. This pandering to the ego can cause the cost of government to skyrocket (does this ring a bell?).

A really problematic side effect is that these new employees need something to do. So the powers that be create new regulations requiring citizens, especially business operators, to jump through new and additional hoops.

The crowning glory of this takeover by the bureaucracy is that if you fail to abide by the new regulations – THEY CAN FINE OR PENALIZE you, as well.

Sorry to go off on this subject, but I fear the bureaucracy. Is that a great way to run a country or what? The only thing that remains unresolved in my mind – is the government purposely trying to destroy us, or is it just the ineptness inherent in any huge organization?

OK, I mentioned at the start that there are two things that the POA provides. This second one is usually the more important of the two for the taxpayers. Once a POA is on file with the IRS, they are NOT permitted to have ANY personal communication with you – they MUST, by law, deal through your legal POA representative.

They will continue to send you copies of all mailed correspondence, but are prohibited from phoning you or attempting to meet with you in person.

In having dealt (sometimes at an emotional level – this IRS stuff can get scary) with hundreds of people with IRS problems over thirty-plus years of butting head with the IRS, I have learned that this knowledge: “I don’t have to see or even speak with the IRS again as long as Tom is representing me” takes a great load off the minds of my clients.

I have commented in previous blogs that I take a great deal of satisfaction from the work that I do. This scenario is not untypical. A single mother of three comes to me to explain that the IRS has levied her paycheck and she can’t buy her kids food, much less pay the rent.

The tissue box gets invaded as she explains her situation. By the time she leaves, she has dried her eyes and told me that she feels a great weight has been lifted. She knows that she will get her paycheck back and that we will help her through all the IRS red tape.

Our motto: defending our fellow citizens against their government by making sure the IRS obeys the rules.