Authorization is the part of payroll that is invisible when it works and impossible to work around when it does not. Without the right form on file at the right agency, even a perfectly prepared return cannot transmit.
Form 8655 — federal
IRS Form 8655 (Reporting Agent Authorization) is the federal authorization that lets a service provider file the 94x family of returns and make federal tax deposits on the client's behalf. Without an 8655 on file at the IRS, no service provider can transmit a client's 941 — including us.
The form is included in the onboarding signing packet. Once it is signed, we submit it to the IRS for processing. The IRS takes a few weeks to recognize the authorization in their systems; once they do, transmissions on the client's behalf accept normally.
State authorizations
States vary widely. Some accept a copy of the IRS 8655 as proof of authorization. Many use their own form — New York uses TR-2000, Massachusetts uses M-2848, Minnesota uses POA-1, and so on. A few require an online portal designation rather than a paper form.
When a client signs up, the onboarding packet bundles all of the per-state forms the client needs based on the states where they have employees. Adding a new state later may require a new state-specific authorization, which we generate and route at that point.
What the authorization lets us do, and not do
A reporting agent authorization lets us prepare returns, sign and transmit them under our agent ID, make tax deposits, and receive copies of agency notices. It does not give us general legal authority over the client's tax affairs. We cannot represent the client in an audit, negotiate a settlement, or sign anything outside the specific scope of the authorization.
Authorizations can be revoked. If a client moves off Payrollix, the next reporting agent (or the client themselves) submits a new 8655, which supersedes ours at the IRS. The same applies to each state authorization.
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