A ‘State Tax Power of Attorney Form’ is a legal document that is used by one party to confer to another party the power to file tax returns and manage one’s finances. This form is issued by the tax departments of the various states and is subject to some unique rules and regulations.
The form is used to prepare, sign, execute, file, and inspect the returns and reports of the taxpayers. It is the agent (the person who is appointed to act on behalf of a taxpayer), who carries out these responsibilities after receiving these powers officially.
Who can be your state tax POA?
Different states impose different rules and regulations regarding who qualifies to be given this power. These differences notwithstanding, there are some ‘universal’ requirements. At the very minimum, the person has to be a US citizen, aged 18 and above, be of sound mind, and trustworthy enough to handle confidential financial tasks.
Type of taxes an STPOA can file
Taxation regimes vary greatly from state to state. These variations determine to a great extent the kinds of taxes that an STPOA can file. Regardless of these variations though, there are some taxes that are remitted in just about every other state. They are stipulated hereunder:
Personal Income Tax
This is a tax that is levied on the salaries, wages, interests, and dividends which a taxpayer earns year-round. The tax is imposed by the state in which the said income earner resides. Its actual rate varies from state to state and from time to time.
Corporate Income Tax
A corporate tax is much like the income tax. It is however levied on a corporate entity rather than an individual. Like the personal income tax, its actual rate varies from time to time and state to state. It is hence a good thing to get to know the existing laws that govern it.
Unlike the personal income and corporate taxes, the sales tax is imposed on the goods and services that are sold or on the receipts from the sales revenues. This tax is perhaps the most varied in the sense that its actual rate may be set at the county rather than the state level.
Real Property Tax
Lastly comes the real property tax. This is an annual tax on the real estate property. It is almost always a local tax and is fixed with regard to value. The tax may be suspended in case of capital transfers and exclusions.
Free State Tax POA Forms (by State)
When to use an STPOA?
The remittances of the various taxes happen within specified timelines which must never be skipped. To stay away from the adverse consequences that arise with the skipping of these deadlines, you want to put in place measures to prevent the same. Choosing and using this form is hence advisable if yours is a squeezed schedule.
Are you just about to serve a prison term? You will still have to pay some taxes, especially on your real estate property. Since you will not be able to do so on your own while in prison, you have to acquire and make use of the state tax power of attorney form.
By traveling overseas, you will not be able to keep paying your taxes locality. In the meantime, you will have to appoint someone else to pay the taxes for you. The state tax power of attorney form will yet again come to your rescue. It lets you delegate the role to a third party.
Lack of Expertise
Some tax forms are way too complicated to handle alone. You definitely have to appoint someone, who obviously has the required expertise to do the trick. This person in many cases is someone who is well-versed with matters taxation and is hence well-able to do a good job.
Some chronic illnesses also render one incapable of fulfilling his normal duties. If you happen to be affected by these illnesses, you will yet again have to appoint a proxy to act on your behalf. The form will prove a handy companion at such times.
Existing State Laws
Your first and foremost consideration should be the existing state laws. The laws that govern the granting of these powers vary greatly from state to state and sometimes county to county. It is necessary to know about the rules that govern the issuance of these forms in your state for the avoidance of doubt.
Other than the laws, the procedures that have to be followed to actualize the power transfer also comes in handy. You yet again have to acquaint yourself with these procedures to see to it that you do a comparatively good job.
In most states, this form has a strict timeline within which it may be in force. It is yet again a good thing to know the restrictions that govern the timelines. You want to do everything in accordance with the law and to avoid the possibility of ruffling feathers with the relevant state authorities.
Though lawyers are really not necessary in the entire process, you will find them quite handy and useful among the way. That is because the lawyers generally help to simplify those tough concepts and ensure that you enter an agreement which you fully understand.
It is necessary that you work only with official documents. Many states do not recognize any other form than that which they themselves produce. You do not want to risk your own life by choosing to work with a form that is not really going to be acknowledged and recognized.