The IRS has made a "correction" to my 2003 personal tax return.  My
accountant believes the IRS is wrong, and is asking me to sign a Form
2848 giving him power of attorney so he can discuss the matter
directly with the IRS.  Are there any risks to my signing such a form,
or any specific limitations I should note on it?

Hello and thank you for your question.  I am familiar with this
process, and my answer is based on my personal experience.

Here's an image of the form:
http://www.irs.gov/pub/irs-fill/f2848.pdf

In Item 3, Tax Matters, you should indicate Income Tax for the type of
tax, Form 1040 (or 1040A, etc. depending on what you filed) for the
Form, and 2003 for the year.  That will limit his authority to what
you need him for.

Although you could limit his authority further in Item 5, I suggest
you leave it blank.  As you'll see by reading the description, the IRS
has already protected you by expressly excluding the things that you
wouldn't want your accountant to do.

Most important, DO NOT initial Item 6.  There's no reason your refund
check should go to anyone but you.

Items 7 and 8 should also be left blank -- the IRS default choices are good ones.

Search terms used:
2848

Thanks again for bringing us your question.  If you require any
clarification of this answer, please feel free to ask.  I would
appreciate it if you would hold off on rating my answer until I have a
chance to respond.

Google Answers Researcher
Richard-ga

Just what I needed to know - thanks.