Power of Attorney (POA) for pass-through entities December 2020 Tax News

We received this question from our preparer community.

Does a tax professional need to complete a POA declaration for every member/partner when representing a pass-through entity (PTE)?

No, for a tax professional to represent a pass-through entity, we only require a POA declaration for the entity as a whole. If an individual member/partner of the PTE wants to be represented by a tax professional (whether the same one who represents the PTE or a different one), then that individual must submit a separate POA declaration.

There are a few unique situations where a POA declaration must be filed for both the entity and an individual partner/member, such as:

  • If the entity is participating in the Voluntary Disclosure Program
  • Adjustments are being made at the individual level

If a tax professional is representing both the entity and any individual partners/member, then a separate POA declaration is required from the entity and each individual partner/member.