Power of Attorney Scenarios If... And... Then the taxpayer is... Form 2848, POA is... The LLC is a single member disregarded entity… (except for employment taxes for which the entity is not considered disregarded; see Treas. Reg. § 301.7701-2(c)(2)(iv)(B)) The business or activity is reporting income and expenses on Form 1040, Schedules C or E… The individual. Spouses cannot sign on behalf of the member/spouse unless a separate POA exists naming the spouse. Signed by the individual (member) and should include the SSN (and if one exists for employment or excise taxes, the EIN of the LLC.) The LLC is a single member disregarded entity… (except for employment taxes for which the entity is not considered disregarded; see Treas. Reg. § 301.7701-2(c)(2)(iv)(B)) The business or activity is reporting income on Form 1041, Trust or Estate Tax Return The trustee, executor or other fiduciary responsible for filing the Form 1041 return; Generally the fiduciary must submit Form 56. Signed by the trustee, executor or fiduciary with the authority to bind the trust or estate, listing the EIN from the Form 1041. The LLC is a single member disregarded entity… (except for employment taxes for which the entity is not considered disregarded; see Treas. Reg. § 301.7701-2(c)(2)(iv)(B)) The issue is employment taxes reported on Forms 940/941 series The LLC business. Signed by the LLC member. See Treas. Reg. § 301.7701-2(c)(2)(iv)(B) The LLC (regardless of number of members) elects to be treated as an association taxable as a corporation… The business is reporting income on Form 1120, U.S. Corporation Tax Return… The corporation Signed by a current corporate officer or employee having the authority to bind the corporation using the corporate EIN. The LLC (regardless of number of members) elects to be treated as an association taxable as a corporation… The business is reporting income on Form 1120 S, U.S. Income Tax Return for an S Corporation and liability is determined at the corporate level… The corporation Signed by a current corporate officer or employee having the authority to bind the corporation using the corporate EIN. The LLC (regardless of number of members) elects to be treated as an association taxable as a corporation… The business is reporting income on Form 1120 S, U.S. Income Tax Return for an S Corporation and liability is determined at the shareholder level… The individual shareholder Signed by the shareholder using the SSN (or in the case of a qualifying trust, the trust EIN). The LLC is a multiple member entity… Also refer to the TEFRA and BBA* Rules *The Bipartisan Budget Act of 2015 (Public Law No. 114-74) The business or activity reporting on Form 1065, U.S. Return of Partnership Income, is NOT subject to TEFRA or BBA rules and liability is determined at the entity level (e.g., employment taxes). The LLC Signed by a member manager or a non-managing member who has the authority to bind the LLC. For more information, please refer to the Form 2848 instructions. The LLC uses its EIN. The LLC is a multiple member entity… Also refer to the TEFRA and BBA* Rules *The Bipartisan Budget Act of 2015 (Public Law No. 114-74) The business or activity reporting on Form 1065, U.S. Return of Partnership Income, is NOT subject to TEFRA or BBA rules and liability is determined at the member level (e.g., flow-through items, distributive shares of income, deductions, credits, etc.). Each member separately Signed by each member using his/her SSN The LLC is a multiple member entity… Also refer to the TEFRA and BBA* Rules *The Bipartisan Budget Act of 2015 (Public Law No. 114-74) The LLC is a TEFRA partnership and has designated a Tax Matters Partner (TMP) on Form 1065, U.S. Return of Partnership Income, or via Form 13798-L, for regular entity level business. The members Generally, a POA in a TEFRA proceeding is the POA of the TMP, although other members may also have POAs and participate in the proceeding. There is not a POA of the LLC in a TEFRA proceeding. The TMP must sign the Form 2848 to name a POA for the TMP. If the TMP is an entity, a person who can bind the TMP-entity under state law must sign the Form 2848 on behalf of the TMP. For POAs of individual members, see the instructions to the Form 2848 instructions for who signs for a person. The LLC is a multiple member entity… Also refer to the TEFRA and BBA* Rules *The Bipartisan Budget Act of 2015 (Public Law No. 114-74) The business or activity reporting on Form 1065, U.S. Return of Partnership Income, is subject to BBA rules and the IRC Chapter 1 liability (for the adjustments to the partnership-related items) is determined at the entity level. The LLC Signed by the Partnership Representative (PR) (or its Designated Individual if the PR is an entity). The POA rules for BBA entities are explained in detail in the Form 2848 Instructions. The LLC is a multiple member entity… Also refer to the TEFRA and BBA* Rules *The Bipartisan Budget Act of 2015 (Public Law No. 114-74) The business or activity reporting on Form 1065, U.S. Return of Partnership Income, is subject to BBA rules but the tax liability arises under: Chapter 2: Tax on Self-Employment Income (Sections 1401 to 1403), Chapter 2A: Unearned Income Medicare Contribution (Section 1411), Chapter 3: Withholding of Tax on Nonresident Aliens and Foreign Corporations (Sections 1441 to 1464), or Chapter 4: Taxes to Enforce Reporting on Certain Foreign Accounts (Sections 1471 to 1474) The LLC for non-BBA items and/or each relevant member Form 2848 for the LLC is prepared for income (including pass-through) items for non-BBA matters and/or Foreign Withholding Tax (all these items are outside the BBA regime) and signed by a binding member for an LLC. The LLC is a multiple member entity… Also refer to the TEFRA and BBA* Rules *The Bipartisan Budget Act of 2015 (Public Law No. 114-74) The business or activity reporting on Form 1065, U.S. Return of Partnership Income, is subject to BBA rules but how the member treats the pass-through items flowing from the LLC is determined at the member’s level The members Form 2848 is prepared for the member’s respective tax return and follows the applicable rules for preparing Form 2848 (e.g., individual, partnership, etc.). For more information, please refer to the Form 2848 Instructions.
