Representing taxpayers and withdrawing from representation.

The regulations to represent or practice before the IRS are published in Circular 230, Regulations Governing the Practice of Attorneys, Certified Public Accountants, Enrolled Agents, Enrolled Actuaries, and Appraisers before the Internal Revenue Service (31 CFR Part 10) and the Statement of Procedural Rules (Sections 601.501-601.509). "Any CPA who is not currently under suspension or disbarment from practice before the IRS and who is duly qualified to practice as a CPA in any state, possession, territory, commonwealth, or in the District of Columbia may practice before the IRS"; see Pub. 947, Practice Before the IRS and Power of Attorney. The CPA must be designated as the taxpayer's representative or power of attorney (POA) and file Form 2848, Power of Attorney and Declaration of Representative, or a written declaration with the IRS, stating that he or she is authorized and qualified to represent a particular taxpayer.

To Represent

To discuss or to correspond with the IRS on a taxpayer's behalf, a CPA has four options to submit Form 2848.

1. Mail or fax a signed form to the IRS Centralized Authorization File (CAF) at the address or fax number in Pub. 947 (both the taxpayer and tax representative must sign and date the form). The IRS will process the authorization within two to seven days. Once the information is entered in the CAF system, the CPA will be able to have discussions and correspond with the IRS.

2. Telephone the IRS Practitioner's Hotline ([phone]) to discuss an "account related" item. Before any discussion ensues, however, the CPA enters the taxpayer's Social Security number via a touchtone telephone keypad. On connecting to an IRS agent, a fax number will be given to submit Form 2848. The CPA stays on the line while the IRS agent receives the fax and prepares to discuss the taxpayer. At the completion of the call, the CPA may request to have Form 2848 submitted to the CAF system. Note: This may not always get accomplished, and the CPA will have to use another method to have the form processed.

3. Call the telephone number listed on the taxpayer's correspondence and fax Form 2848 immediately. This option is not always available, however, because certain IRS centers do not have this capability. An agent will ask the representative to fax the form to the CAF system and to call the same telephone number in a few days.

4. Use E-Services. A CPA must be an authorized E-services provider to assess this option. Information from the taxpayer's prior tax return is needed to enter the POA information. As E-Services is new, processing may take hours or days, and not all options on Form 2848 are available. (For information about becoming an authorized E-Services user, see Maida, Tax Practice Management, "IRS Launches Enhanced E-Services," TTA, June 2005, p. 358.)

Review of Representation

Each CPA should review his or her CAF listing. A computerized listing of the taxpayer's authorizations under the CAF number may be obtained through the Freedom of Information Act (FOIA); for a sample letter to request a computerized listing, see Exhibit 1 at right. (Note: fees will be waived for requesters in areas affected by Hurricane Katrina. Practitioners so affected must state in the letter that they have been affected, indicate their home and/or business address and request a waiver.)

Exhibit 1: Sample letter to request a computerized listing of a
taxpayer's authorizations under a CAF number

Date

Internal Revenue Service
Headquarters Disclosure Office
1111 Constitution Avenue NW
SE:S:C&L:GLD:D
Fax: [phone]

Dear Chief, Disclosure:

This is a request under the Freedom of Information Act.

I request that a copy of the CAF Representative/Client Listing be
provided to me. I do not wish to inspect the documents first.

In order to determine my status for the applicability of fees, you
should know that I am an "Other" requester seeking information for
noncommercial or personal use. I am a tax professional and my CAF
number is xxxxxxx. (This is not your Enrolled Agent Number.)

As proof of identity, I am including a photocopy of my driver's
license, a notarized statement or a sworn statement, as defined in the
FOIA Guide, "To Establish Proof of Identity and Right to Access"

[] Send listing as a paper document. I am willing to pay copying fees
for this request, up to a maximum of $xx. If you estimate that the fees
will exceed this limit, please inform me first. (No charge for the
first 100 pages and $0.20 per page thereafter).

[] Send listing on diskette as a text file using Windows NotePad.

Thank you for your consideration of this request.

Sincerely,

(Signature)

The IRS processing time is four to eight weeks. The CAF Representative Listing packet, which is mailed to the CPA, will include:

* A letter confirming the CPA's request (the page limit, if stated in the letter, and a contact person's name and phone number);

* IRS Pub. 216, Conferences and Practice Requirements;

* Notice 393, Information on an IRS Determination to Withhold Records Exempt From the Freedom of Information Act-5 U.S.C. 552; and

* The computerized CAF Representative List.

The computerized document will list one tax matter, form and year per line. One taxpayer may have several lines on the list. The packet does not include an explanation of the columns. Most of the information is self-explanatory, per Form 2848. Briefly, the main columns from left to right are:

* Taxpayer's Social Security number or Federal taxpayer identification number (TIN).

* Taxpayer's name.

* Date the taxpayer added or updated the authorization.

* CAF document locator number.

* Authorization form number (Form 2848, Form 8821, Tax Information Authorization, etc.) and date the form was signed.

* Master File Tax Code (e.g., 30, Form 1040; 02, Form 1120; 06, Form 1065, etc.).

* Tax Period and authorization code (e.g., a, attorney; b, CPA; c, EA, etc.).

* Several columns labeled Notices, Refund, Inspection (Form 8821), Blind T (Blind Trust) and Date of the POA/Tax Information Authorization Action.

Not to Represent (Withdrawal of the Authorization)

To withdraw from representation, a CPA must write a letter and mail or fax it to the CAF at the state address or fax number listed in Pub. 947; see Exhibit 2 on p. 54 for a sample letter. The letter must state the taxpayer's name, Social Security number or Federal TIN, the tax matter, tax form and the year as listed on Form 2848. Attaching Form 2848 is beneficial, but not required. The CAF Representation Listing will provide the information needed to withdraw the representation.

Exhibit 2: Sample letter to withdraw an authorization

Date

Internal Revenue Service
(CAF Address)

RE: Withdrawal of Power of Attorney

Dear Sir or Madam:

The undersigned, pursuant to CFR Section 601.505(b)(1), hereby
withdraws as representative of the following:

Taxpayer name:

Address:

Social Security number:

Tax:

Form:

Year(s):

If you have any questions, please contact me at (xxx) xxx-xxxx.

Very truly yours,

(Signature)

Enclosure: Form 2848

Once the CPA processes the withdrawal letter, no IRS correspondence should be accepted on the taxpayer's behalf. Such correspondence should be unopened and returned to the IRS with an explanation--"representation has been withdrawn." If the Service continues to send notices, the withdrawal letter should be relaxed, with a new cover letter stating the problem.

Note: The IRS will send a confirmation of the withdrawal letter within two to four weeks to both the CPA and the taxpayer. The return address will be the CAF location. The CPA should retain this letter in the taxpayer's permanent file.

FROM RUTH ANN MICHNAY, CPA, MBT, EA, RUTH ANN MICHNAY, P.A., OAKDALE, MN