Signing another person's name -- with permission
Philip Kremer
name on legal documents, etc., on the understanding that
Smith is thereby taking on whatever legal obligations might
be incurred. For example, my wife would like to give me
permission to sign her name on our federal tax forms (we
live five hundred miles apart) so that I do not have to send
them to her, just so that she can sign them and send them
back to me.
Under these circumstances, would the signing be considered
forgery? Would it be illegal, if the person whose name has
been signed assented to it?
Thanks
Philip Kremer
nos...@isp.com
On Tue, 02 Mar 1999 -- forgetting that applicable law about such matters
varies from jurisdiction to jurisdiction yet neglecting to mention
geography and therefore relegating/limiting all responses to "generally
speaking, with exceptions" -- <Phil Kremer> kre...@morpheus.cis.yale.edu
(Philip Kremer) said/asked:
>Suppose that Smith gives Jones permission to sign Smith's
>name on legal documents, etc., on the understanding that
>Smith is thereby taking on whatever legal obligations might
>be incurred.
Whaddayah (and howdayah) mean by "understanding"?
Upon S authorizing J to sign on S's behalf, by definition, J's so doing has
(only) the effect of S doing so.
Whether or not the third-party (T) is aware that the actual signature
physically has been made by J.
And when T is aware that, physically, J signed for S (whether by signing
merely "S" or "S, by J" or "J on behalf of S"), what T is thus aware of is
that J is S's agent, that the person being bound thereby therefore is J's
principal, S, and that (also, by definition) an agent generally is not
personally liable for S' obligations. However, where T relies on J's
authority but J is not in fact authorized to sign for S, in most places J
is liable to T on the (common law) ground of breach of warranty of
authority: to the extent T suffers a loss by reason of acting in reliance
of J's representation that S was thereby being bound whereas S does not
honor what J represented to be S's obligation, J will be obliged to make T
whole for that loss. Theoretically.
An "understanding" that J will make S whole by reason of J's exceeding J's
authority granted by S, as between the two, is legally speaking a very
different kind of "understanting" than one to the effect that J will be
liable to T. That is, apart from the express or implied "warranty"
referred to above (in jurisdictions which will enforce such), long-standing
law in most jurisdictions (generally, the "Statute of Frauds") is to the
effect that Party1 is not obliged to answer to Party3 for the debts to
Party3 of Party2 unless Party1 has signed a document (an "instrument") so
undertaking.
In any event and as a practical matter, in most situations a T ain't gonna
rely on a J's legally enforceable authority to bind an S without a writing
so stating signed by S. That's why God invented
pre-printed/fill-in-the-blank power of attorney forms.
>For example, my wife would like to give me
>permission to sign her name on our federal tax forms (we
>live five hundred miles apart) so that I do not have to send
>them to her, just so that she can sign them and send them
>back to me.
She can do that, even if you resided in the same place.
>
>Under these circumstances, would the signing be considered
>forgery? Would it be illegal, if the person whose name has
>been signed assented to it?
No. *B*U*T* -->
Never underestimate the myriad varieties of human misremembery and
perversity, especially where money is involved. All the more so when
separated spouses and money and the IRS is involved.
Even though what you contemplate is frequently done even without any
written confirmation, ask yourself:
Why make life complicated by real yet sloppily informal "understandings"
which later may become misunderstandings when a power of attorney -- which
can be short and simple and not fancilly-printed á la the legal stationary
store kind -- would avoid or at least substantially mitigate such an
eventuality? . . . as would a simple/straight-forward agreement signed by
S and J stating what "obligation" J is "taking on" and which will be
"incurred" to whom by reason of J acting for S in the manner suggested.
>
>Thanks - Philip Kremer
Note that not addressed here is a somewhat special issue viz-a-viz spouses
and the IRS when one spouse prepares and signs a joint return on behalf of
both yet in circumstances where there might later be a dispute whether,
even if the non-signing spouse's income/deductions had been
accurately/validly reported/computed, the preparing/signing spouse had
underreported or overdeducted. And, anyway, don't forget the above
it-can-vary-from-place-to-place and "generally speaking (only)" cautionary.
. .
rca...@pipeline.com
Stan Brown
In this next-to-last year of the millennium, kre...@morpheus.cis.yale.edu
(Philip Kremer) wrote in article <36fc37ca...@news.supernews.com>
in misc.legal.moderated:
>my wife would like to give me
>permission to sign her name on our federal tax forms (we
>live five hundred miles apart) so that I do not have to send
>them to her, just so that she can sign them and send them
>back to me.
>
>Under these circumstances, would the signing be considered
>forgery? Would it be illegal, if the person whose name has
>been signed assented to it?
A real lawyer will probably post an answer, but in the meantime I think
you want to look into "power of attorney". She should be able to buy a
standard POA form at a legal-supply store or large stationery store or
find one in a legal self-help book such as
Nolo Press /The Financial power of Attorney Workbook/
(I found this book on the Nolo web site, www.nolo.com. I have not read
it, and in any event I'm not an attorney so I'm not competent to pass
judgment on it. Nolo does have a good reputation for its self-help legal
books, however.)
Then you would sign *your* name as attorney for her. the exact form to
use would also be in the book. I think it's something on the order of
"John Smith, attorney in fact for Jane Smith", but I'm not at all
certain.
Doing it the way you're thinking of could be very dangerous. (1) An alert
tax authority might notice the similar handwriting and refuse to accept
the form. (2) It might be forgery or tax fraud; I don't know. (3) The tax
authority might accept it, but suppose a year or two from now you and
your wife are having difficulties, and she *claims* that you signed
without authorization?
There are many many ways that simply signing her name, even with her
consent, could turn into a huge mess. A written power of attorney will
protect you both. it also lets her specify limited purposes if she wants.
One question I have no idea about is whether tax authorities will accept
a power of attorney for someone who is not incapacitated. If your wife
were in a coma you would probably be able to sign for her. But if she's
competent, and t's merely inconvenient to have her sign the form, I'm not
sure you can do this in any way. You might want to call the tax authority
and ask, before you get into any sort of elaborate or dubious matters.
Again, I'm not a lawyer, and this is not legal advice.
--
Stan Brown, Oak Road Systems, Cleveland, Ohio, USA
http://www.mindspring.com/~brahms/
My reply address is correct as is. The courtesy of providing a correct
reply address is more important to me than time spent deleting spam.
William Marvin
>Under these circumstances, would the signing be considered
>forgery? Would it be illegal, if the person whose name has
>been signed assented to it?
Generally, forgery is defined as signing someone else's name without their
consent, so it ain't forgery. But I have no idea if the IRS would accept
a proxy signature, however.
+----------------------------------------------+
|--William D. Marvin, Esq. ++ wdm...@ibm.net--|
|---------Abington, PA (215) 881-9488---------|
|-visit Philadelphia Trial Lawyers on the Web -|
+---------- http://philatla.org ---------------+
!fortune.tag
Jon Beaver
>Suppose that Smith gives Jones permission to sign Smith's
>name on legal documents, etc., on the understanding that
>Smith is thereby taking on whatever legal obligations might
>be incurred. For example, my wife would like to give me
>permission to sign her name on our federal tax forms (we
>live five hundred miles apart) so that I do not have to send
>them to her, just so that she can sign them and send them
>back to me.
>
>Under these circumstances, would the signing be considered
>forgery? Would it be illegal, if the person whose name has
>been signed assented to it?
>
The wrong is not to your wife, but to the IRS, who has been made to
think that they have a valid enforceable signature of your wife. It's
their permission for you to sign for her that you should be
considering in determining whether a crime has been committed.
-Jon Beaver
Edward G. Puhl
Philip Kremer wrote in message <36fc37ca...@news.supernews.com>...
>Suppose that Smith gives Jones permission to sign Smith's
>name on legal documents, etc., on the understanding that
>Smith is thereby taking on whatever legal obligations might
>be incurred. For example, my wife would like to give me
>permission to sign her name on our federal tax forms (we
>live five hundred miles apart) so that I do not have to send
>them to her, just so that she can sign them and send them
>back to me.
You don't want to sign your wife name, even with her knowledge and
permission, because it would not be her genuine signature, i.e., a forgery.
Rather, if she's given you permission, it should be by written power of
attorney. Operating under a power of attorney, you would print her name,
afterwhich you would sign "By John Doe, her attorney-in-fact." That would
make it clear to others relying on the document that you had such authority,
and it would be proper for them to ask to see your original power of
attorney, for example, if there was any concern.
>
>Under these circumstances, would the signing be considered
>forgery? Would it be illegal, if the person whose name has
>been signed assented to it?
Technically, it's a forgery, even though the one who's name was forged is
not about to complain, as would be the case with a stolen check, for
example.
Edward G. Puhl
Note: This information should not be relied upon as a substitute for advice
from a licensed attorney familiar with all of the facts of your case.
Art Kamlet
Philip Kremer <kre...@morpheus.cis.yale.edu> wrote:
>Suppose that Smith gives Jones permission to sign Smith's
>name on legal documents, etc., on the understanding that
>Smith is thereby taking on whatever legal obligations might
>be incurred. For example, my wife would like to give me
>permission to sign her name on our federal tax forms (we
>live five hundred miles apart) so that I do not have to send
>them to her, just so that she can sign them and send them
>back to me.
If you have been granted a legal Power of Attorney (POA) by
someone, you can print their name, then "by" - Print then sign your
name and add POA (or attorney-in-fact, depending on the state.)
Note: in virtually all states, there are some documents that a POA
will not grant you power of attorney. For example, chances are
your state does not allow you to grant anyone power of attorney to
change your will.
As far as power of attroney to sign a federal tax return, it would
appear that a carefully drafted POA can allow you to grant this
power. But the IRS has been known to get particularly fussy,
asking for their own particular POA form, and giving you a hard
time if you use any other form. Perhaps in this era of a
friendlier IRS, they will more readily accept your own POA.
However, since the IRS has its own form, and this is why you want
a POA, why not just use the IRS POA form? ( try www.irs.gov
and get to forms and pubs and search for the form.)
--
Art Kamlet Columbus, Ohio kam...@infinet.com
Vladimir Menkov
Philip Kremer <kre...@morpheus.cis.yale.edu> wrote:
>Suppose that Smith gives Jones permission to sign Smith's
>name on legal documents, etc., on the understanding that
>Smith is thereby taking on whatever legal obligations might
Very good question! I have often wondered about this too... It appears
to me that if Jones does it on IRS documents, Smith may need to
execute IRS Form 2848 (Power of Attorney), but I don't know
details. IRS has Publication 947 on a similar topic, AFAIK. Otherwise,
just a regular power of attorney certified by a notary public is
enough. But I am not a lawyer, and would appreciate an expert to
clarify the issue for us.
I am curious also whether there are any tax caveats to such
"on-behalf-of-other person" transactions too. Suppose Jones, a
resident of US and the State of NY, owns $20K worth of
income-producing investments. Every year he receives some $2K worth
of income from this invetsment (mainly interest, dividend, and
short-term cap gains), pays income tax on it at his 28% marginal rate
(+ the state tax, of course), and gives the remaining $1200 or so to
his relative Smith. These gifts do not reduce Jones' tax liability in
any way, since he can't claim Smith as his dependent under the IRS
rules.
Then he figures out that Smith actually is in a lower tax bracket
(because she has lower income, or because she is a non-resident alien
and is subject to different tax laws), so he sells his investments,
gives the $20K to Smith (filing a gift tax return, or spreading the
gift over 2 years to be under the $10K limit), and has her put the
money into a similar investment, so that Smith now pays her own income
tax on the investment income at the lower tax rate. Since Smith can't
tell the difference between a bank CD and a music CD, Jones does most
of the day-to-day asset management on her behalf, placing mutual fund
and bank transactions, and occasionally signing forms for her, with
her permission. Smith, of course, has an ATM card for the main account
and maintains overall control.
In such a situation, is there some US law that attributes Smith's
investment income to Jones because the principal originated from him,
or because he does much of the day-to-day management for Jones? I
know that some other countries have quite peculiar rules about such
"income shifting" or "income splitting" situations: for example, if a
Canadian earns some money, gives it to his stay-at-home wife, and she
invests it, the investment income may still have to be attributed to
the husband. (As you can guess, Canada has no joint returns). But the
only similar rule I know about in the USA is the "kiddie tax", about
the investment income of certain children under 14 years of age. Are
there other pitfalls?
--Vladimir
Art Kamlet
Vladimir Menkov <vme...@cs.indiana.edu> wrote:
>
>Then he figures out that Smith actually is in a lower tax bracket
>(because she has lower income, or because she is a non-resident alien
>and is subject to different tax laws), so he sells his investments,
>gives the $20K to Smith (filing a gift tax return, or spreading the
>gift over 2 years to be under the $10K limit), and has her put the
>money into a similar investment, so that Smith now pays her own income
>tax on the investment income at the lower tax rate. Since Smith can't
>tell the difference between a bank CD and a music CD, Jones does most
>of the day-to-day asset management on her behalf, placing mutual fund
>and bank transactions, and occasionally signing forms for her, with
>her permission. Smith, of course, has an ATM card for the main account
>and maintains overall control.
A gift must be a bona fide gift -- a real, true gift where the
giver has given up all incidents of ownership.
Here Jones appears to have retained at least some ownership, and
so has made a "sham" gift," which means no gift at all. It's
still his.
To push sham gifts to the limit, suppose I ask you to work for me
for free, but as you're my friend, I later give you a totally
unexpected gift. Think that will fly?
Or suppose a large corporation has a policy of honoring all
employees at the end of the year with a large gift that depends on
how well the compnay has done? Or the company has a policy of
honoring all employees who have worked there 25 years with a
$10,000 gift? None of these are bona fide gifts.
Frank
kre...@morpheus.cis.yale.edu (Philip Kremer) wrote:
> Suppose that Smith gives Jones permission to sign Smith's
> name on legal documents, etc., on the understanding that
> Smith is thereby taking on whatever legal obligations might
> permission to sign her name on our federal tax forms (we
> live five hundred miles apart) so that I do not have to send
> them to her, just so that she can sign them and send them
> back to me.
>
> forgery? Would it be illegal, if the person whose name has
> been signed assented to it?
It could well be illegal -- ESPECIALLY when you're dealing with signing tax
forms -- invest in the envelopes and stamps and avoid the possibility this
could come back to haunt you either criminally or civilly.
The above is not legal advice, for legal advice see an attorney.
Frank
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Rod
> >permission to sign her name on our federal tax forms (we
> >live five hundred miles apart) so that I do not have to send
> >them to her, just so that she can sign them and send them
> >back to me.
Why not just file electronically?
Frank
wdm...@ibm.net (William Marvin) wrote:
> In <36fc37ca...@news.supernews.com>, on 03/02/99
> at 07:15 PM, kre...@morpheus.cis.yale.edu (Philip Kremer) said:
>
> >forgery? Would it be illegal, if the person whose name has
> >been signed assented to it?
>
> consent, so it ain't forgery. But I have no idea if the IRS would accept
> a proxy signature, however.
Keep in mind that it's hazardous to limit thinking to the framework of the
question. It probably wouldn't be "forgery," but it could well be "perjury,"
since tax returns are signed under penalty of perjury. Signing someone's
else's name is a wilfull false statement that the return was signed by that
person which the IRS could argue is "perjury." It could be "material" in
that the false signature could materially change the IRS's remedies against
the person who did not sign the return.
For another far-out possibility -- and far-out arguments do inhabit tax law
-- the IRS could argue that the spouse who didn't REALLY sign the return has
violated federal law by failing to submit a return, which is not only illegal
but keeps the return for that year open for IRS review indefinitely.
William Marvin
>Technically, it's a forgery, even though the one who's name was forged is
>not about to complain, as would be the case with a stolen check, for
>example.
Hate to be painstaking, but as the judge pointed out in my first jury
trial, we're in a painstaking business. Other states may define it
differently, but here's PA's crime code:
Section 4101. Forgery
(A) OFFENSE DEFINED. --A person is guilty of forgery if, with intent to
defraud or injure anyone, or with knowledge that he is facilitating a
fraud or injury to be perpetrated by anyone, the actor
. . . .
(2) makes, completes, executes, authenticates, issues or transfers any
writing so that it purports to be the act of another who did not authorize
that act, or to have been executed at a time or place or in a numbered
sequence other than was in fact the case, or to be a copy of an original
when no such original existed;
Linc Madison
Philip Kremer <kre...@morpheus.cis.yale.edu> wrote:
>Suppose that Smith gives Jones permission to sign Smith's
>name on legal documents, etc., on the understanding that
>Smith is thereby taking on whatever legal obligations might
>permission to sign her name on our federal tax forms (we
>live five hundred miles apart) so that I do not have to send
>them to her, just so that she can sign them and send them
>back to me.
Check out these links:
<http://ftp.fedworld.gov/pub/irs-pdf/f2848.pdf> Form
<http://ftp.fedworld.gov/pub/irs-pdf/i2848.pdf> Instructions
(You might want to start with the instructions.)
The IRS main web site: <http://www.irs.ustreas.gov>
Search: <http://www.irs.ustreas.gov/prod/forms_pubs/findfiles.html>
My reading of the instructions for line 5 of the form is that you
cannot authorize another person to sign your tax return unless you
meet certain conditions (illness, injury, prolonged absence from the
United States, etc.).
In other words, as I understand the IRS instructions, they WILL NOT
accept any power of attorney in the circumstances you have described
here.
Assuming that you both trust each other, you could complete the
return and mail it to your wife, who would then sign it and mail
it directly to the IRS. You might also look into filing an electronic
return -- you may still have to have a piece of paper signed by both
of you, but you might be able to fill it out in advance.
In any case, as a fallback, you might fill out a Form 4868 (automatic
extension) and have her send it back to you, just so that you can be
sure that something with both signatures gets mailed by April 15th.
Disclaimers: I am neither a lawyer nor a tax expert.
--
** Do not send me unsolicited commercial e-mail spam of any kind **
Linc Madison * San Francisco, California * Telecom@LincMad-com
URL:< http://www.lincmad.com > * North American Area Codes & Splits
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