Taxation & Regulation (REG)

What is Treasury Circular 230?

Treasury Department regulations (31 CFR Part 10) governing practice before the IRS — the duties and restrictions on attorneys, CPAs, enrolled agents, enrolled actuaries, enrolled retirement plan agents, and other practitioners, plus the sanctions for violations.

Who is permitted to practice before the IRS under Circular 230?

Attorneys, CPAs, enrolled agents (EAs), enrolled actuaries, and enrolled retirement plan agents have full practice rights. Annual filing season program participants and certain unenrolled preparers have limited rights (only for returns they prepared).

What does 'practice before the IRS' include under Circular 230?

Communicating with the IRS on a taxpayer's behalf, representing a taxpayer at conferences/hearings/meetings, preparing and filing documents, and rendering written tax advice. Merely preparing a return is generally not, by itself, 'practice,' though it makes one subject to Circular 230.

Under Circular 230, what must a practitioner do when a client has not complied with the tax laws or has made an error or omission?

Promptly advise the client of the noncompliance, error, or omission and explain the consequences (including penalties) under the Code and regulations. The practitioner is not required to notify the IRS, but must inform the client.

Under Circular 230, what is the rule on a practitioner's reliance on client-provided information (due diligence)?

A practitioner may generally rely in good faith, without verification, on information furnished by the client. However, the practitioner must make reasonable inquiries if the information appears incorrect, inconsistent, or incomplete.