State Tax Power of Attorney Forms
The State Tax Power of Attorney Forms are written documents filed with the state tax department by taxpayers who require assistance from another party to complete one or more taxation-related tasks. In most cases, the party the taxpayer appoints to stand in for them before the department will be a tax preparer, attorney, CPA, or another professional qualified to handle tax matters. Each state has its own set of guidelines regarding the types of tasks the taxpayer may delegate, the information they must provide to do so, and the signing requirements the taxpayer must uphold. It is therefore essential for the taxpayer to comprehend what is expected of them from their respective state tax department before filing this form.
Tax Power of Attorneys by State
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Carolina
- North Dakota
- Rhode Island
- South Carolina
- South Dakota
- West Virginia
What is a State Tax Power of Attorney?
A State Tax Power of Attorney is a document that each state provides to its taxpayers so that they may make a request for another party to appear on their behalf before the department. A state may require the taxpayer to use a specific form that is unique to their state, or they may direct the taxpayer to use Form 2848: Power of Attorney and Declaration of Representative, which is a federal Power of Attorney form provided by the Internal Revenue Service (IRS).
For example, the Arizona Department of Revenue requires citizens of the state to use the state-specific form, Form 285: General Disclosure/Representation Authorization Form. Whereas, the state of Nevada asks its citizens to make use of Form 2848.
The taxpayer is free to select who will represent them before the department, so long as that individual meets any requirements set forth by their state tax department. For instance, many states only allow certain individuals to serve in this role, such as attorneys and Certified Public Accountants. The name by which this party is referred to varies state by state, however, they will typically be referred to as the Agent, Attorney-in-Fact, Appointee, Representative, or the Power of Attorney.
Regarding the tasks the taxpayer may delegate to their Agent, the taxpayer will be limited to delegating only those tasks permitted by their state tax department. Some states allow the taxpayer to list out for themselves the tasks they wish for their Agent to handle. Whereas, other states provide a limited number of options that the taxpayer must make their selection from.
Examples of tasks the taxpayer may be permitted to delegate to their Agent include:
- Receiving and inspecting confidential tax information for the tax matters the taxpayer has specified,
- Executing settlement and closing agreements
- Signing a statute of limitations waiver for the taxpayer,
- Accessing their IRS records,
- Receiving refund checks,
- Representing the taxpayer in relevant tax proceedings,
- Signing tax-related documents on their behalf, and
- Signing their tax return (see below for further information).
In order to complete the form, the taxpayer will be required to indicate their preferences regarding:
- Whether they only want to grant their Agent access to their confidential tax information or whether they want to grant them additional authorizations,
- Whether they want their Agent to access confidential information about all tax matters or only specific tax matters, and
- Whether they want their Agent to access confidential information spanning the entirety of their tax history, or only specific years.
Can a Power of Attorney Sign a Tax Return?
According to the IRS, there are limited circumstances in which a Power of Attorney (i.e., the Agent or Attorney-in-Fact) may sign a tax return on behalf of the taxpayer. Specifically, the Power of Attorney may sign a tax return for the taxpayer so long as both of the following criteria are met:
- The Internal Revenue Code and Regulations Section 1.6012-1(a)(5)) permit the signature, and
- The taxpayer provides specific authorization in the Power of Attorney agreement for the signature to take place in line with the Internal Revenue Code and Regulations Section 1.6012-1(a)(5)).
These laws only permit the Power of Attorney to sign the tax return in a few cases. Namely, if the taxpayer cannot sign the return themselves due to disease or injury, if they will be absent from the U.S. at least sixty (60) days before the taxpayer’s tax return is due to be filed, or if special permission is obtained from the IRS due to a “good cause”.
If the Power of Attorney qualifies to sign the tax return, the tax return should be filed alongside a copy of the Power of Attorney form that includes the taxpayer’s authorization (as per the second set of criteria noted above).