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IRS Pronouncements on Representative Capacity, Restitution Assessments and E-Signatures

Posted on Dec. 24, 2021

A few IRS documents, two of which are internal facing and two of which are public facing, deserve mention.  The internal facing documents are copies of advice from Chief Counsel National Office to a field office.  This type of advice is advice that Chief Counsel’s office must make public but that does not bind the agency.  The field attorneys, who might see an issue once in their career, regularly seek advice from the National Office where a subject matter expert might regularly come across the issue.

Representative Capacity

The first advisory opinion appears related to a Tax Court case and the concern of the field attorney whether the person who filed the petition on behalf of an estate has the capacity to do so.  The advice was rendered on August 6, 2021 in CCA 2021080609223250 and provides:

We have reviewed this matter, as well as received the input of our colleagues in Branch 4. Our conclusion is that the best course of action here is to have the * * * appointed by a Florida court as the estate’s personal representative. I am attaching here a CCA that was brought to my attention by Branch 4 with some similarities to the present fact pattern.

As you noted in your initial analysis, the rules of the Tax Court provide that the capacity of a fiduciary or other representative to litigate is determined in accordance with the law of the jurisdiction at issue, in this case Florida. In keeping with PA policy, we defer to your own interpretation of the substance of Florida law. Given your conclusion that there are likely no provisions of Florida law authorizing a trustee to act in this manner, and given Branch 4’s conclusion that when an individual has not been appointed as the personal representative of the estate, Form 56 should be rejected absent authority under local law, attaining personal representative status from the Florida court would be the logical conclusion.

This issue regularly presents itself in estate cases if someone contests the tax liability without first getting appointed as the executor or personal representative of the estate. The government looks carefully in any case that does not involve an individual bringing the case on their own behalf to make sure that the person instituting the proceeding has the capacity to do so.

Restitution Assessment

We have written several posts on various issues regarding restitution assessments.  The IRS can make an assessment prior to going through the deficiency procedures if the district court handling a criminal tax matter takes certain prescribed acts.  Here the National Office gives advice to the field office on July 21, 2021 in CCA 2021072113061244 that a restitution based assessment should not occur in a case because the district court failed to enter the type of order that would support such an assessment:

This is not an assessable order of restitution under section 6201(a)(4). While the court imposes upon the defendant a duty to pay taxes during the period of supervised release, the court does not specify a sum certain due as restitution to the United States. Courts often impose conditions of supervised release requiring a taxpayer to cooperate with the IRS or pay taxes, but we do not treat these as assessable orders of restitution unless a sum certain is imposed by the court. Here, no such amount is specified either in the court’s judgment, in the transcript of the sentencing hearing, or in any separate order of restitution. There is some discussion in the sentencing hearing transcript about restitution, but no sum certain is ever imposed as restitution against the defendant.

While short, the CCA does provide valuable information regarding the type of order in a criminal case that will not support a restitution based assessment. This provides another reminder to look closely at the actions of the criminal court in reviewing the IRS administrative actions following prosecution.

Electronic Signatures

The pandemic has become the mother of invention in a number of areas including signatures.  Because of the difficulty and potential danger in requiring actual signatures on many documents, the IRS has created lists of documents on which it will accept electronic signatures.  On November 18, 2021, the IRS updated its list of documents on which it would accept an electronic signature.  The list approves electronic signatures through October 31, 2023 – maybe the IRS knows something about how long the pandemic will last.


Douglas W. O’Donnell
Deputy Commissioner for Services and Enforcement

Temporary Deviation from Handwritten Signature
Requirement for Limited List of Tax Forms

This memorandum revises the memorandum issued on April 15, 2021 (Control Number NHQ-10-0421-0002).

As part of our response to the COVID-19 situation, we have taken steps to protect employees, taxpayers and their representatives by minimizing the need for in-person contact. Taxpayer representatives have expressed concerns with securing handwritten signatures during these times for forms that are required to be filed or maintained on paper. To alleviate these concerns while promoting timely filing, we are implementing a deviation with this memorandum that allows taxpayers and representatives to use electronic or digital signatures1 when signing certain forms that currently require a handwritten signature. The forms to which this flexibility applies can be found in the attachment to this memo. Such forms must be signed and postmarked on August 28, 2020 or later. The attachment may be updated from time to time to either add or remove applicable forms as appropriate.


Form 11-C, Occupational Tax and Registration Return for Wagering;

Form 637, Application for Registration (For Certain Excise Tax Activities);

Form 706, U.S. Estate (and Generation-Skipping Transfer) Tax Return;

Form 706-A, U.S. Additional Estate Tax Return;

Form 706-GS(D), Generation-Skipping Transfer Tax Return for Distributions;

Form 706-GS(D-1), Notification of Distribution from a Generation-Skipping Trust;

Form 706-GS(T), Generation-Skipping Transfer Tax Return for Terminations;

Form 706-QDT, U.S. Estate Tax Return for Qualified Domestic Trusts;

Form 706 Schedule R-1, Generation Skipping Transfer Tax;

Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return;

Form 709, U.S. Gift (and Generation-Skipping Transfer) Tax Return;

Form 730, Monthly Tax Return for Wagers;

Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons;

Form 1066, U.S. Income Tax Return for Real Estate Mortgage Investment Conduit;

Form 1120-C, U.S. Income Tax Return for Cooperative Associations;

Form 1120-FSC, U.S. Income Tax Return of a Foreign Sales Corporation;

Form 1120-H, U.S. Income Tax Return for Homeowners Associations;

Form 1120-IC DISC, Interest Charge Domestic International Sales — Corporation Return;

Form 1120-L, U.S. Life Insurance Company Income Tax Return;

Form 1120-ND, Return for Nuclear Decommissioning Funds and Certain Related Persons;

Form 1120-PC, U.S. Property and Casualty Insurance Company Income Tax Return;

Form 1120-REIT, U.S. Income Tax Return for Real Estate Investment Trusts;

Form 1120-RIC, U.S. Income Tax Return for Regulated Investment Companies;

Form 1120-SF, U.S. Income Tax Return for Settlement Funds (Under Section 468B);

Form 1127, Application for Extension of Time for Payment of Tax Due to Undue Hardship;

Form 1128, Application to Adopt, Change or Retain a Tax Year;

Form 2678, Employer/Payer Appointment of Agent;

Form 3115, Application for Change in Accounting Method;

Form 3520, Annual Return to Report Transactions with Foreign Trusts and Receipt of Certain Foreign Gifts;

Form 3520-A, Annual Information Return of Foreign Trust With a U.S. Owner;

Form 4421, Declaration — Executor’s Commissions and Attorney’s Fees;

Form 4768, Application for Extension of Time to File a Return and/or Pay U.S. Estate (and Generation-Skipping Transfer) Taxes;

Form 8038, Information Return for Tax-Exempt Private Activity Bond Issues;

Form 8038-G, Information Return for Tax-Exempt Governmental Bonds;

Form 8038-GC; Information Return for Small Tax-Exempt Governmental Bond Issues, Leases, and Installment Sales;

Form 8283, Noncash Charitable Contributions;

Form 8453 series, Form 8878 series, and Form 8879 series regarding IRS e-file Signature Authorization Forms;

Form 8802, Application for U.S. Residency Certification;

Form 8832, Entity Classification Election;

Form 8971, Information Regarding Beneficiaries Acquiring Property from a Decedent;

Form 8973, Certified Professional Employer Organization/Customer Reporting Agreement; and Elections made pursuant to Internal Revenue Code section 83(b).


1Electronic and digital signatures appear in many forms when printed and may be created by many different technologies. No specific technology is required for this purpose during this temporary deviation.

I decided that copying the list of documents here was easier than sending you to a link. It’s interesting what the IRS finds acceptable for an e-signature. The memorandum does not provide an explanation of the criteria used for making the selection of forms. This list relates to forms leading to a determination of liability.

On the same date, the IRS issued a list of forms taxpayers can e-sign that relate to the collection of tax:


Douglas W. O’Donnell
Deputy Commissioner for Services and Enforcement

(1) Approval to accept images of signatures and digital signatures
(2) Approval to receive documents and transmit encrypted documents by email

This memorandum supersedes the April 15, 2021, memorandum (Control Number NHQ-01-0421-0001) to provide additional employee guidance and an extended expiration date.

In response to the COVID-19 situation and stakeholder requests, we are taking steps to protect employees and taxpayers while still delivering on our mission-critical functions. We are maximizing the ability to execute on critical duties in a remote working environment where employees, taxpayers and their representatives are working from alternate locations. In accordance with IRM, When Procedures Deviate from the IRM, this memorandum extends temporary deviations that allow IRS employees (1) to accept images of signatures and digital signatures on documents related to the determination or collection of tax liability and (2) to send or receive documents to or from taxpayers using email with encrypted attachments when no other approved electronic alternative is available. These deviations apply to any statement or form traditionally exchanged between IRS personnel and taxpayers during a compliance interaction outside of standard filing procedures. Refer to Attachment 1, Procedures, for additional guidance.

This memorandum is effective upon issuance through October 31, 2023. The signature and email exceptions permitted under this memorandum do not establish a precedent for acceptable use of alternative signatures or email in other circumstances.

The collection forms impacted by this notice are described as follows:

This guidance covers interactions between IRS employees and taxpayers related to the determination or collection of tax liability (“compliance interactions”). The scope of documents affected include any statement or form traditionally exchanged between IRS personnel and taxpayers during a compliance interaction and outside of standard filing procedures, including but not limited to:

Document CategoryExamples
Extensions of statute of limitations on assessment or collectionForms 872 and 921 series, Forms 900, 952, 977, 2750, 4016, SS-10
Waivers of statutory notices of deficiency and consents to assessmentForms 870, 890, 2504, 4089-B, 4549, 5564-A, 13449
Agreements to specific tax matters or tax liabilities (closing agreements)Forms 866, 906, 14490, 14491, 14492
Prior-year (delinquent) tax returns secured through an examination or collection interaction Caution: Returns which are not yet due to be filed, including extensions, should be filed in accordance with the instructions for the respective form.Forms 940/941, 1040, 1120, 1065  
Other statements or forms needing the signature of a taxpayer or representative traditionally collected outside of standard filing proceduresForms 433-A/B/D, 2159, 2297, 3363, 4669, 4670, 8626, 12153  
Other statements or documents relevant to development of a case, not limited to IRS forms or signed documents
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