Can this be signed electronically?

Yes. Electronic signatures are generally enforceable under the ESIGN Act (15 U.S.C. §7001) and UETA in most states, provided intent, consent, attribution, and reliable record retention are met.

Is notarization ever required?

Notarization depends on payor policy and state law. Some payors or jurisdictions require a notarized or witnessed signature to accept authority; confirm with the payor before execution.

How do I revoke a payment authority?

Revoke by delivering written notice to the payor and agent; include the effective revocation date. Retain proof of delivery and confirm acceptance with the payor to stop further disbursements.

What if the TIN is wrong?

An incorrect TIN can trigger 24% backup withholding and IRS mismatch notices. Correct errors immediately and supply an updated W-9 or equivalent to the payor.

How should signers be authenticated?

Authentication ranges from email verification to SMS codes or identity-proofing. Use stronger methods (KBA, multi-factor) where payors require higher assurance or where funds are large.

How long should I keep signed copies?

Retain signed authorities per applicable rules: at least 3 years for IRS-related records (IRC §6501(a)) and 6 years for HIPAA-related documents (45 CFR §164.530(j)); consult counsel for specific holdings.

Electronic Signature
Templates
Finance
Third Party Payment Authority

Third Party Payment Authority

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

Third Party Payment Authority

This Third Party Payment Authority (the "Authority") is executed by the Account Holder identified below to authorize the Payor to accept payment instructions from, and to direct payments to, a designated Third Party as set forth herein. By signing this Authority the Account Holder grants the Payor and the financial institution limited instruction and collection rights strictly in accordance with the scope described in this document.

1. Account Holder and Payee

Account Holder:

Name:

Account Holder Address: Payee / Billing Reference (if applicable): Account / Reference Number with Payee:

2. Third Party (Recipient / Agent)

Third Party Name: Third Party Address:

Contact Name:

Phone:

Email for Notices:

3. Scope of Authority

The Account Holder hereby authorizes the Payor to accept payment instructions from the Third Party for the following purpose(s). Select applicable authority and provide the requested details.

Scope (select applicable):

One-time payment only. Invoice / Reference:

Recurring payments for invoices issued to Account Holder, frequency: ; Maximum per occurrence: $

Authority to direct payment of all amounts due to Payee from Account Holder until revoked in writing.

Effective Date: Termination Date (if any):

4. Payment Method & Banking Instructions

Payment Method(s) authorized (select all that apply). If ACH or Wire is selected, provide Third Party banking details below.

ACH transfer Wire transfer Check remittance

Third Party Bank Name:

Routing / ABA Number:

Account Number:

Account Type:

Checking Savings

5. Revocation, Liability and Indemnity

Revocation: This Authority may be revoked by the Account Holder only by providing written notice to the Payor. Revocation shall be effective upon actual receipt by the Payor and shall not affect payments already processed in reliance on this Authority prior to such receipt.

Liability: The Payor and any financial institution acting in good faith and in accordance with payment instructions from the Third Party and this Authority shall not be liable for any loss or delay arising from honoring such instructions. The Account Holder remains responsible for ensuring sufficient funds and for resolving disputes directly with the Third Party and the Payor.

Indemnity: The Account Holder agrees to indemnify, defend and hold harmless the Payor and its agents from and against any and all claims, liabilities, losses, damages, costs and expenses (including reasonable attorneys' fees) arising out of or relating to the Payor's reliance on this Authority or any instruction given by the Third Party within the scope of authority granted herein.

6. Notices

All notices required or permitted under this Authority shall be in writing and delivered to the contact details provided in this form. Notice is effective upon receipt by the designated contact.

Notice Address for Account Holder: Notice Address for Third Party:

7. Representations; Certification

The undersigned represents and warrants that: (a) the undersigned is authorized to execute and deliver this Authority on behalf of the Account Holder; (b) all information provided in this Authority is true and correct; (c) the Account Holder will comply with any terms and conditions of the Payor and applicable financial institution(s) governing payments; and (d) the Account Holder accepts the payment and revocation procedures and the liability allocation described herein.

Additional Instructions or Conditions (optional):

The Account Holder acknowledges that this Authority constitutes a binding authorization to accept payment instructions from the Third Party in accordance with the scope specified above and that the Account Holder has read and understands the terms, revocation procedures, and indemnity provisions contained herein.

I certify that I am authorized to execute this Authority on behalf of the Account Holder and that I accept the terms and conditions herein.

Authorizing Party:

Signature:

Date:

What a Third Party Payment Authority Is and When it Applies

A Third Party Payment Authority is a written authorization that permits a designated third party to receive or direct payments on behalf of the named payee. It names the payor, payee, and authorized agent; describes scope and duration; and records taxpayer identification or account details needed to route funds. The document is commonly used by businesses, property managers, legal representatives, and payroll administrators to streamline payments, verify payee identity, and document consent for third-party handling of funds.

Why a Clear Third Party Payment Authority Matters

A properly completed Third Party Payment Authority reduces payment delays, protects payors from duplicate payments, and documents consent in case of disputes. It clarifies responsibilities, supports audit trails, and helps meet payer compliance checks such as TIN validation and bank account verification.

Who Typically Completes and Signs This Form

Organizations and individuals use this form when payments must be routed to an agent, vendor, or representative rather than the original payee.

Payroll and HR teams who delegate payroll disbursements to payroll processors or agencies.
Property managers and real estate firms handling rent or insurance proceeds for owners.
Legal and fiduciary representatives authorized to receive settlements or client funds.

Use clear role names and current contact data to avoid processing delays and potential withholding or compliance issues.

Who Can Sign and Why Their Role Matters

Company Officer

An authorized officer (CEO, CFO, treasurer) may sign on behalf of a business entity. Their signature binds the organization and confirms corporate authority, often validated by corporate resolution or signature authority records when requested by the payor.

Designated Agent

An individual appointed by the payee (payment agent, attorney, property manager) can sign if the payee explicitly names and empowers them. Payors typically verify identity and may require notarization or supporting documentation.

Essential Sections Every Professional Third Party Payment Authority Should Include

A complete Third Party Payment Authority contains identifiable payor/payee information, a precise authorization scope, payment routing details, verification elements, signatures, and any authentication or notarization requirements. Clear drafting prevents ambiguity about which payments are covered and for how long.

Parties

Full legal names and contact details for the payor, payee, and third-party agent, including business addresses and email for notices; use exact entity names to match tax and bank records.

Scope of Authority

A precise description of which payments the agent may receive or direct (e.g., monthly rent, insurance proceeds), including any exclusions or monetary limits to avoid unintended authorizations.

Payment Instructions

Routing details such as bank account number, ACH details, or instructions to remit to a named service provider; include account owner name and bank routing information for verification.

Tax and ID Data

Taxpayer Identification Number (TIN) or EIN, and any required tax forms references; accurate TINs prevent backup withholding and support IRS reporting obligations.

Effective Dates

Clear effective and expiration dates, or events that terminate the authority; identifying the start and end dates avoids open-ended obligations and statute-of-limitations ambiguity.

Signature and Authentication

Signed and dated by the appropriate party or authorized officer; note any notarization, witness, or authentication method required by the payor or jurisdiction.

Step-by-Step: Completing a Third Party Payment Authority

Follow each step in order to ensure the authority is valid and actionable for payment processing and tax reporting.

01

Prepare parties: Gather legal names, addresses, and TINs for all parties.
02

Define scope: Describe which payments and any monetary limits.
03

Add routing: Enter bank or account details for payment delivery.
04

Sign and date: Have authorized parties sign; notarize if required by payor or jurisdiction.

Where to Send or File the Completed Authority

Routing depends on the payor’s internal procedures; follow the payor’s specified submission path to ensure timely processing.

Direct to Payor: Send the signed form to the payor’s accounts payable or finance department as specified in invoice instructions.
Bank or Processor: Provide a copy to the receiving bank or payment processor when routing instructions require bank verification.
Agent Records: Keep a signed copy on file with the authorized agent for reconciliation and audit purposes.
Tax Reporting: Retain and provide documentation needed for IRS reporting or payer withholding requirements.

Configuring an Online Workflow for Third Party Payment Authorities

Set up a repeatable digital workflow to collect, authenticate, and store authorities while minimizing manual steps and errors.

Field	Configuration
Authentication	Email plus optional SMS or knowledge-based verification
Conditional Fields	Show bank details only when 'electronic transfer' is selected
Payments	Request payment info only for processors that require it
Retention	Auto-archive signed copy to secure storage

Key Information the Form Must Capture

Payor/Payee Names: Full legal names

Authorized Agent: Name and title

TIN / EIN: Nine-digit identifier

Routing Details: Bank or account numbers

Effective Dates: Start and end dates

Signature Block: Signed and dated

Common Risks and Consequences of an Incorrect Authority

Backup Withholding: 24% withholding for incorrect TIN

Returned Payments: Misrouted funds may be reversed

Tax Reporting Errors: Incorrect payee data affects 1099 reporting

Civil Liability: Unauthorized disbursements risk breach claims

Regulatory Fines: Sector fines for noncompliance

Delay Costs: Processing delays increase administrative cost

Frequent Preparation Errors to Avoid

Using nicknames or abbreviated entity names that don’t match tax or bank records, which can trigger holds or rejections.
Omitting TIN or entering incorrect digits, causing backup withholding or IRS mismatches during reporting.
Failing to specify exact scope leading to disputes about which payments are authorized.
Not checking payor requirements for notarization or witness signatures, delaying processing or requiring re-execution.

eSignature Provider Comparison for Executing Payment Authorities

Comparison of typical vendor starting prices and common feature availability for executing and storing Third Party Payment Authorities. Pricing reflects plan-level starting points and common feature presence.

	signNow	DocuSign	Adobe Sign	PandaDoc	HelloSign
Starting Price	$8/user/mo	$15/user/mo	$14/user/mo	$19/user/mo	$15/user/mo
Free Trial	7-day free trial	Varies by vendor	Varies by vendor	Varies by vendor	Varies by vendor
Bulk Send	Yes	Yes	Yes	Yes	No
HIPAA Compliant	Yes	Yes	Yes	No	No

Frequently Asked Questions About Third Party Payment Authorities

Answers to common questions on enforceability, notarization, revocation, and electronic execution of Third Party Payment Authorities.

Need help? Contact support

Can this be signed electronically?
Yes. Electronic signatures are generally enforceable under the ESIGN Act (15 U.S.C. §7001) and UETA in most states, provided intent, consent, attribution, and reliable record retention are met.
Is notarization ever required?
Notarization depends on payor policy and state law. Some payors or jurisdictions require a notarized or witnessed signature to accept authority; confirm with the payor before execution.
How do I revoke a payment authority?
Revoke by delivering written notice to the payor and agent; include the effective revocation date. Retain proof of delivery and confirm acceptance with the payor to stop further disbursements.
What if the TIN is wrong?
An incorrect TIN can trigger 24% backup withholding and IRS mismatch notices. Correct errors immediately and supply an updated W-9 or equivalent to the payor.
How should signers be authenticated?
Authentication ranges from email verification to SMS codes or identity-proofing. Use stronger methods (KBA, multi-factor) where payors require higher assurance or where funds are large.
How long should I keep signed copies?
Retain signed authorities per applicable rules: at least 3 years for IRS-related records (IRC §6501(a)) and 6 years for HIPAA-related documents (45 CFR §164.530(j)); consult counsel for specific holdings.

be ready to get more

Join over 28 million airSlate SignNow users

Sign Now