Form 2848, Power of Attorney and Declaration of Representative, authorizes an individual to represent you before the IRS. Power of Attorney (POA) can be granted to immediate family members or authorized tax professionals including CPAs, attorneys, and enrolled agents. Some reasons to potentially get a POA would be when someone is ill or disabled and are unable to handle their financial situation, you're being audited by IRS, or if you have unresolved tax debt.
Not all POAs are the same. Using the IRS forms eliminates cumbersome requirement for processing by IRS counsel to approve of the powers provided by the legal document. Using the IRS form is faster and more efficient.
Merely checking the box on the tax return to allow IRS to speak to the preparer only gives limited authority to discuss that particular tax return and that authorization ends automatically on the due date of the return the following year. Checking the box on the return also does not allow authorized individuals to negotiate payment plans, sign on your behalf, receive copies of IRS notices, respond to notices on your behalf, access transcripts from your IRS account or appeal a dispute with the IRS.
Because of these reasons, it is common practice in our firm to get a POA on file when completing a client's tax return. This ensures that John B. Lane CPA can provide the best comprehensive service to our clients and handle all their tax needs. Ensure prior to signing any POA that the scope of authority and tax years selected are broad enough to meet your needs.