Tips to Reduce CAF Number Errors and Protect Data from Cyberthieves
The IRS has outlined common errors that may delay processing of Centralized Authorization File (CAF) numbers
, thereby speeding the approval process for tax professionals. Since CAF numbers are valuable cybercriminal targets, the IRS has also shared steps tax professionals should take each year to help protect their CAF numbers.
Form 2848, Power of Attorney and Declaration of Representative, grants eligible practitioners the authorization to represent a client before the IRS. Form 8821, Tax Information Authorization, grants individuals or organizations the authorization to inspect a client’s tax records.
When practitioners submit Forms 2848 or 8821 for the first time, they are issued a nine-digit CAF number that they use as an identifier on all their future third-party authorization requests. During fiscal year 2018, the IRS rejected 384,081 authorization requests. Issues that cause an IRS CAF assistor to reject the Forms 2848 or 8821 include:
- Lack of an original pen and ink signature (use of a digital signature, no signature or use of a signature stamp) by the taxpayer.
- The Representative Designation is not complete on page two of Form 2848.
- The signor did not prepare the return, as required by the Level H designation on Form 2848.
- The Representative information is incomplete or missing on Form 2848 (Designation; Licensing Jurisdiction or Authority; Bar, License, Certification, Registration or Enrollment Number or representative signature and/or date).
- Check of the box six to add a new designee but retain the former designee. A copy of the old Form 2848 is required to retain the prior authorization; however, the copy is not attached.
- Forms 2848 or 8821 are missing the required Taxpayer and/or Representative identification information.
- The Tax Matter identification is not specific. The completion of “all years” or “all future periods” is not acceptable.
- The title of the Officer of the Business and/or Company (if applicable) is blank.
- The date of the Taxpayer signature is blank.
Click here for steps tax professionals can take to protect their CAF numbers from cyberthieves.