In Uncategorized on 06/29/2015 at 18:58

Once again we visit Form 2848, to see what it cannot do. That Steven N. Levi and Cristina Levi learn the hard way; thereby hangs the tale of 2015 T. C. Memo. 118, filed 6/29/15.

And it is a cautionary tale, both for preparers and their clients. The form doesn’t solve all your problems. In fact, it can be a landmine. Read the instructions, then the Regs therein cited, and govern yourselves accordingly.

Judge Dawson: “…petitioners hired Florida attorney S to prepare their Form 1040, U.S. Individual Income Tax Return…. …petitioners executed Form 2848, Power of Attorney and Declaration of Representative, appointing Ms. M and her assistant, Misty…, as their representatives. Ms. M prepared, signed, and timely submitted petitioners’ … return on their behalf, attaching thereto Form 2848, which states in relevant part: ‘Acts authorized. * * * the authority does not include * * * the power to sign certain returns’.” 2015 T. C. Memo. 118, at p. 2. (Names omitted).

In fact, an agent (not a power of attorney; a power of attorney is a piece of paper. An agent is one who acts by virtue of a POA) cannot sign a 1040 or other return except as set forth in Reg. 1.6012-1(a)(5).

Check out that Reg. And make sure you remember it. If you want the “good cause” exception, spell it out and file it in the right place (and attach it to the POA as well, for good measure), and get clearance as stated in the Reg, before you file the return. Ms. M may be getting The Phone Call; don’t y’all get it.

Steve’s and Cris’ attorney appears, disappears and asked to be restored. This is done, but none of Steve nor Cris nor attorney reply to IRS’s request for admissions. These track Reg. 6012-1(a)(5).

“The return of income may be made by an agent if, by reason of disease or injury, the person liable for the making of the return is unable to make it. The return may also be made by an agent if the taxpayer is unable to make the return by reason of continuous absence from the United States (including Puerto Rico as if a part of the United States) for a period of at least 60 days prior to the date prescribed by law for making the return. In addition, a return may be made by an agent if the taxpayer requests permission, in writing, of the district director for the internal revenue district in which is located the legal residence or principal place of business of the person liable for the making of the return, and such district director determines that good cause exists for permitting the return to be so made.” Re. 1-6012-1(a)(5).

That’s it, guys.

So the return Ms. M filed is no return at all. Even if IRS processed it, that doesn’t make it a return. So nonfiling chop follows, and if underpayment of withholding or ES, that follows too.

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