IRS Representation Before the IRS 3 — Questions and Answers
Question 1: Which of the following is the proper procedure when an enrolled agent wishes to withdraw from representing a client during an IRS examination?
- File a written notice of withdrawal with the examining agent (Correct answer)
- Simply stop responding to IRS correspondence
- File a new Form 2848 naming a substitute representative
- Notify the IRS by telephone and confirm within 30 days in writing
Correct answer: File a written notice of withdrawal with the examining agent
To withdraw from representation, the enrolled agent should provide written notice to the IRS office handling the matter and inform the client of the withdrawal.
Question 2: An enrolled agent represents a client in an audit. During the audit, the IRS agent asks the enrolled agent to produce records that may be protected by attorney-client privilege. The enrolled agent should:
- Produce all records immediately to cooperate with the IRS
- Assert attorney-client privilege on behalf of the client
- Assert the federally authorized tax practitioner privilege if applicable and consult with the client (Correct answer)
- Refuse to produce any records and terminate the audit
Correct answer: Assert the federally authorized tax practitioner privilege if applicable and consult with the client
Under IRC §7525, a limited privilege applies to confidential communications between enrolled agents and their clients for non-criminal tax advice; the EA should assert this privilege if applicable and consult the client.
Question 3: A Form 2848 is generally valid until:
- December 31 of the year it was signed
- The IRS revokes it
- The taxpayer or representative revokes it, or it expires by its own terms (Correct answer)
- Three years from the date of filing
Correct answer: The taxpayer or representative revokes it, or it expires by its own terms
A Form 2848 remains valid until it is revoked by the taxpayer, the representative withdraws, or the authorization expires according to its own stated terms.
Question 4: Under what circumstances may an unenrolled return preparer represent a taxpayer before the IRS?
- In any IRS proceeding if the taxpayer provides a signed statement
- Only before the Taxpayer Advocate Service for any issue
- Before examination officers for returns the preparer prepared and signed, for tax years after December 31, 2015, if in the Annual Filing Season Program (Correct answer)
- For any examination as long as the taxpayer is present
Correct answer: Before examination officers for returns the preparer prepared and signed, for tax years after December 31, 2015, if in the Annual Filing Season Program
Unenrolled return preparers who hold an Annual Filing Season Program (AFSP) record of completion may represent taxpayers before revenue agents and customer service representatives for returns they prepared and signed.
Question 5: Which disciplinary sanction under Circular 230 allows a practitioner to continue practicing before the IRS while under corrective measures?
- Disbarment
- Suspension
- Censure (Correct answer)
- Criminal referral
Correct answer: Censure
Censure is a public reprimand that does not restrict the practitioner's right to practice before the IRS, unlike suspension or disbarment.
Question 6: A taxpayer revokes a power of attorney on file with the IRS. What is the proper way to notify the IRS of this revocation?
- Call the IRS 1-800 number and provide the authorization number
- File a new Form 2848 with 'REVOKE' written across the top, or send a written statement of revocation (Correct answer)
- File Form 8821 to replace the power of attorney
- The revocation is automatic when a new representative is appointed
Correct answer: File a new Form 2848 with 'REVOKE' written across the top, or send a written statement of revocation
To revoke a POA, the taxpayer must send the IRS a copy of the previously executed Form 2848 with 'REVOKE' written across the top, or a written statement of revocation signed and dated by the taxpayer.
Question 7: Which of the following acts requires SPECIFIC authorization on Form 2848 and is NOT automatically granted?
- Signing a protest letter to the Appeals Office
- Receiving copies of IRS notices and communications
- Substituting or adding another representative (Correct answer)
- Requesting transcripts of the taxpayer's account
Correct answer: Substituting or adding another representative
The authority to substitute or add another representative must be specifically granted in the acts authorized section of Form 2848 and is not automatically included.
IRS Representation Before the IRS 3
Which of the following is the proper procedure when an enrolled agent wishes to withdraw from representing a client during an IRS examination?