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EA Part 3 Updated
Does Third Party Designee authority cover all IRS issues?
No. Third Party Designee authority is narrow. It is generally limited to the specific return and tax period and to processing issues for that return.
What if the IRS offers information outside my authorization?
Stay inside the scope of the authorization and engagement. If an IRS employee mentions another tax year or issue, do not turn the call into an unrelated matter without client authority.
Can an AFSP preparer represent a client before the IRS?
Sometimes, but the rights are limited. AFSP participants may have limited representation rights for clients whose returns they prepared and signed, and only before specified IRS functions.
What is the difference between Form 2848 and Form 8821?
Form 2848 authorizes an eligible representative to represent the taxpayer before the IRS for the listed matters and periods. Form 8821 is different. It authorizes access to tax information, but it does not authorize representation.
Can a practitioner ignore unreported cash income?
No. A practitioner should not advise a taxpayer to omit taxable cash receipts or prepare a return that knowingly leaves them out. Forms are evidence, not the boundary of taxable income. Enrolled practitioners are subject to federal conduct rules when practicing before the IRS.
Is a penalty exception the same as a penalty waiver?
No. A penalty exception means the penalty should not apply under the rule. A waiver means the penalty otherwise applies, but the IRS may reduce or remove it because the taxpayer meets a waiver standard. The exam-friendly order is exception first, then waiver.
Why did an estate get an underpayment penalty notice?
Check whether the decedent-estate exception applies. Current Form 2210 instructions say no underpayment penalty applies to a decedent estate for a tax year ending before the date that is two years after the decedent death. Lead with the exception facts.
What controls prevent filing a planning copy?
Use controls that connect the exact return version to the taxpayer authorization and transmission step. Labels for planning vs filing copies, e-file disabled on projection files, two-person review, Form 8879 matching, and acknowledgement review after filing.
Can a wrong credit elect be moved back to the original year?
Frame it as an account-reconciliation problem, not just a return-preparation problem. Once an overpayment is elected to the next year estimated tax, the IRS account may treat it as activity for the following year. Whether it can be corrected depends on the account transcript and the correction path.
Is a superseding return different from an amended return?
Yes. A superseding return is a corrected return filed before the relevant filing deadline, including a valid extended deadline when applicable. An amended return corrects a return after the original filing has already taken effect. For individual income tax, Form 1040-X is the ordinary amended-return form.
What should I do if the wrong return was e-file accepted?
Start by treating the accepted return as a filed return on the IRS account. Do not assume another original e-file will replace it. If the deadline has not passed, evaluate a superseding correction. If passed, an individual return usually points toward Form 1040-X.
How should a tax firm monitor and protect its EFIN?
At the exam level, focus on application accuracy, transmission monitoring, and credential protection. The firm should keep the e-file application current, monitor accepted-return totals, protect e-services credentials, and contact the IRS e-help desk if the EFIN appears compromised.
Can my firm e-file a return it did not prepare?
IRS guidance recognizes that a firm may e-file a return it did not prepare if the firm receives the return directly from the taxpayer and follows the e-file provider rules. That is different from letting another preparer or suspended firm use your EFIN as a workaround.
What is the difference between a PTIN and an EFIN?
A PTIN is the individual paid preparer identifier. An EFIN is tied to an approved IRS e-file provider application. The EFIN is not a substitute for the preparer PTIN, and the PTIN is not a substitute for e-file provider authorization.
Can another preparer use my firm's EFIN?
No, the PTIN alone is not enough. A PTIN identifies an individual paid preparer. An EFIN identifies the authorized IRS e-file provider whose application, suitability, principals, responsible officials, and filing activity are tied to the electronic submission.
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