Revoke Forms 2678, 8821 and State Power of Attorney Forms

Submitted by admin on Tue, 05/04/2021 - 15:37
Policy: 

When a participant transfers to another F/EA or stops using the program for any reason, certain tax authorization granted to F/EA must be revoked. Heretofore, these consumers will be referred to as "closed employers."

Quarterly, after all taxes for a closed employer have been filed, <<Staff Title>>, revokes F/EA’s authorization assigned by the IRS per Forms 8821 and 2678 and any State Power of Attorney Forms for all closed consumers. All revocations are performed per current IRS and State instructions and Stay Up to Date with Forms, Rules and Regulations.
 
 
Notice from tax agencies confirming revocation is tracked in the Customer Service System.
Procedure: 


  1. Quarterly, after all taxes for an employer have been filed, <<Staff Title>> (or assigned staff) revokes Forms 8821, 2678 and State Forms Power of Attorney for closed consumers
  2. Open Payroll System
  3. Identify any closed employers <<Insert process to identify closed consumers>>

Revoke Form 2678

  1. F/EA revokes Form 2678 for any closed consumers after all quarterly tax payments and returns have been completed
  2. For each closed participant, F/EA completes Form 2678
  3. In Part 1, F/EA enters the following information for the participant or representative employer
  • Check box for "Revoke an Existing Appointment"

In Part 2, enter the following:

  • Enter Employer Name (this will be either the participant or the participant's appointed employer)
  • Enter Employer's Address associated with employer's EIN
  • On Line 5, check the first box for "ALL Employees"
  • The employer is NOT required to sign in Part 1 to REVOKE the Form 2678

In Part 3, enter the following

  • Enter F/EA's Aggregate EIN
  • Enter F/EA's address associated with Aggregate EIN
  • Check box for "Check here if the employer is a disabled individual or other welfare recipient receiving home-care services through a state or local program."
  • Authorized signatory for F/EA signs and dates Form 2678 in Part 3
  1. <<Staff Title>> stores copy of Revoked Form 2678 in participant file
  2. <<Staff Title>> records in Customer Service System that Form 2678 was revoked and the date on which it was mailed to the IRS
  3. <<Staff Title>> mails revoked Form 2678 to Internal Revenue Service using "Where to File" chart in insructions for Form 2678
  4. Internal Revenue Service will submit notifcation of Form 2678 revocation with 120 days.  The notice sent by the IRS is IRS LTR 4228C.
  5. When IRS LTR 4228C is received, <<Staff Title>> tracks the date received in Customer Service System
  6. Store IRS LTR 4228C in participant file

Revoke Form 8821

1.  F/EA revokes Form 2678 for any closed consumers after all quarterly tax payments and returns have been completed

2. For each closed participant, locate participant's original Form 8821 in participant file

3. Write “Closed” and the participant’s close date on the top of Form 8821

4. Copy all revoked Forms 8821 for consumers

5. Place original forms back in participant file

6. Mail copies of revoked Forms 8821 to IRS address where original Forms 8821 were submitted

7.  <<Staff Title>> records in Customer Service System that Form 2678 was revoked and the date on which it was mailed to the IRS

8. Internal Revenue Service will NOT submit notifcation of Form 8821 revocation

Revoke Form State Power of Attorney Forms

<<Insert Process to Revoke State Power of Attorney Forms>>

Internal Controls: 

The internal controls used by F/EA to monitor this process establish responsibility, segregate duties, document procedures and ensure independent internal verification.

  1. Dates that revocations are sent are tracked in the Customer Service System
  2. Dates that revocation notices are received are tracked in the Customer Service System
  3. All revocations are sent via Certified Mail
    • Certified Mail receipts are stored with copies of letters for a minimum of 7 years per File Retention Policy
  4. All revocation letters and revoked forms are scanned and stored in each participant’s scan file for a minimum of 7 years per File Retention Policy