Recent Tax Updates

Taxpayer Authorizations and Tax Pro Online Account

July 27, 2021

The IRS has recently added a new feature to Individual Online accounts that allows individual taxpayers to authorize their tax preparer to represent them before the IRS by allowing them to electronically sign the Power of Attorney (POA) that was initiated by their tax preparer. They will also be able to allow their tax preparer to view their accounts with a Tax Information Authorization (TIA).

In order to use this new option, an individual’s tax preparer must be eligible to practice before the IRS. Examples of eligible preparers are Enrolled Agents, CPAs and Attorneys. An unenrolled return preparer is only eligible if they prepared and signed the return, have a valid PTIN and have a Record of Completion for the IRS Annual Filing Season Program. An eligible preparer must also already have a CAF number.

For the tax preparer, the IRS has rolled out the new Tax Pro Account on the IRS website. This first release of the Tax Pro online account will allow eligible tax prepares to initiate POAs and TIAs electronically using a simpler online version of Forms 2848 and 8821.

The process will work as follows:

• Tax preparer will complete and electronically sign the authorization request and submit it to the IRS electronically via their Tax Pro online account.
• The authorization request will appear in the taxpayer’s Online Account. The taxpayer will approve the completed authorization and sign the authorization by simply checking a box and submitting it to the IRS.

Once the digital authorization is completed and approved, it will go directly to the Centralized Authorization File (CAF) database and, in most instances, be immediately recorded and appear on the list of approved authorizations in the taxpayer’s Online Account and the tax preparer’s Tax Pro Account.

In order to access their online accounts, both the individual and their tax preparer must authenticate themselves via the IRS Secure Access process. Individuals that cannot get through the Secure Access process will not be able to use this option. Instead, their tax preparer will need to use fax, mail, or the Submit 2848 and 8821 Online page for completing and submitting authorization forms.

For more information, see the following on the IRS website:

• IRS News Release of July 19 (IR-2021-154) – IRS improves services to taxpayers with digital authorizations and launch of new Tax Pro Account
• Publication 5533 – Why You Should Create an IRS Online Account
• Publication 5533-A – How to Submit Authorizations Using Tax Pro Account and Online Account
• Tax Pro Account – Includes who can use set up a Tax Pro Account and information on how to use the Tax Pro Account
• Individual IRS Online Account