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POA CHANGES IN THE WORKS


Lee B

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The days of faxing in a POA while on the phone with an IRS representative may be coming to an end.

"The Internal Revenue Service has not implemented sufficient processes to authenticate the validity of Forms 2848, Power of Attorney and Declaration of Representative, and Forms 8821, Taxpayer Information Authorization, the Treasury Inspector General for Tax Administration said in a report released Aug. 30.

The forms are used to designate powers of attorney or representatives on behalf of taxpayers, TIGTA said.

“Tax examiner reviews of these forms do not include steps to verify that the legitimate taxpayer submitted or signed the form to authorize access to his or her tax information,” the report said.

TIGTA, which provides independent oversight of IRS activities, made seven recommendations, including that the IRS develop a confirmation letter program to ensure that taxpayers authorized third-party access. The IRS agreed with six recommendations and partially agreed with a recommendation to correspond with representatives and designees assigned multiple centralized authorization file number."

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Is this really a problem?  Has anyone heard of someone submitting a POA without the taxpayers knowledge?  Most representatives are professionals (CPA, EA or attorney) so are they really going to risk losing their license by submitting a false POA.   They would better serve taxpayers by coming up with a better way to verify refundable credits before issuing the refunds without placing additional burdens on tax professionals.

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3 hours ago, Patrick Michael EA said:

Is this really a problem?  Has anyone heard of someone submitting a POA without the taxpayers knowledge?  Most representatives are professionals (CPA, EA or attorney) so are they really going to risk losing their license by submitting a false POA.   They would better serve taxpayers by coming up with a better way to verify refundable credits before issuing the refunds without placing additional burdens on tax professionals.

Yes, it is a problem, but it is not due to professionals.  it is due to 16 stolen CAF numbers related to 73,000 applications, since Sep 2010, all with the representative refund box checked. 

In the report ( see page 25), the IRS does not agree fully with the letter recommendation, saying it would be too costly.  What they plan to do, is send out a statistically significant  sample of letters and from the info gathered develop a third party authorization tool ,  to be implemented Jun 2019.  "Tool" meaning software.  Three other recommendations, which concern internal controls, have already been implemented and a fourth is being monitored.

 

 

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