1.25.1  Rules Governing Practice Before the IRS  (06-01-2010)
Practice Before the IRS Overview

  1. The Office of Professional Responsibility (OPR) is charged with the oversight of tax professionals and is responsible for investigating allegations of misconduct and negligence against attorneys, certified public accountants (CPAs), enrolled agents, enrolled actuaries, and appraisers and other professionals representing taxpayers before the IRS. These procedures explain to employees the standards of competence, integrity, and conduct required of tax practitioners and provide the process for making referrals to OPR.

  2. Practice before the IRS covers all matters connected with a presentation relating to presentations regarding a taxpayer’s rights, privileges, or liabilities under laws and regulations administered by the IRS. Such presentations include, but are not limited to:

    1. Corresponding and communicating with the IRS.

    2. Representing a taxpayer at conferences, hearings, or meetings with the IRS.

    3. Preparing and filing documents with the IRS for a taxpayer.

    4. Providing written advice with respect to any entity, transaction plan or arrangement, or other plan or arrangement having a potential for tax avoidance or evasion.


      "Exchange of Information" is not practice. Individuals who are not practitioners may appear before the IRS as a witness or communicate to the IRS on a taxpayer’s behalf, and appear as a witness—but they may not advocate. In general terms, these individuals are merely assisting with the exchange of information and are not themselves advocating on the taxpayer’s behalf. An example of an individual assisting with information exchange but not practicing would be a taxpayer’s friend serving as a translator when the taxpayer does not speak English. See Note at IRM, Power of Attorney Rights and Responsibilities, (Practice Before the Service).

  3. The Office of Professional Responsibility (OPR) is responsible for communicating and enforcing standards of competence, integrity and conduct among those who represent taxpayers before the IRS, e.g.,

    • Attorneys

    • Certified public accountants

    • Enrolled agents

    • Enrolled actuaries

    • Appraisers


    Circular 230 provides the regulations governing the practice before the IRS and should be consulted regarding rules of practice. These rules also apply to persons who have limited practice privileges because of their relationship to the taxpayer.

  4. The mailing address is:

    1. Office of Professional Responsibility
      Internal Revenue Service
      1111 Constitution Avenue, NW
      SE:OPR , Room 7238
      Washington, DC 20224

  5. Other offices with oversight responsibility for this program include:

    1. The Office of Governmental Liaison and Disclosure, SE:S:CLD:GLD , is responsible for tax information authorization matters and Form 8821. See IRM 11.3.2, Disclosure to Persons with a Material Interest and IRM 11.3.3, Disclosure to Designees and Practitioners.

    2. The Commissioner, Wage and Investment (W&I), Director, Customer Account Services (CAS) is responsible for managing the Centralized Authorization File (CAF) operations. See IRM 21.3.7, Processing Third Party Authorizations onto the Centralized Authorization File (CAF).  (06-01-2010)
Authorities Governing the Rules of Practice

  1. Title 31 CFR Part 10 sets forth the regulations governing representation of taxpayers before the IRS. These regulations are republished by the IRS in Treasury Department Circular 230.

  2. The provisions of Circular 230 set forth who may represent taxpayers, the process for becoming an enrolled agent, duties and restrictions relating to practice, and the process for resolving allegations of violations of those duties and restrictions.

    1. Circular 230 also sets forth the circumstances under which an individual preparer of tax returns may practice before the IRS.

    2. Revenue Procedure 81–38 prescribes the standards of conduct, the scope of authority, and the conditions under which an individual preparer of tax returns may exercise, without enrollment, the privilege of limited practice as a taxpayer’s representative before the IRS.  (06-01-2010)
Power of Attorney and Form 2848

  1. A power of attorney is a taxpayer's written authorization for an individual to act on the taxpayers' behalf in tax matters. A power of attorney is submitted when a taxpayer wants to authorize an individual to represent him/her before the IRS. Most frequently a power of attorney is submitted when a taxpayer wants to be represented at a conference with the IRS or to have a written response prepared and filed with the IRS.

  2. Form 2848, Power of Attorney and Declaration of Representative , is used by a taxpayer to appoint an eligible person to represent the taxpayer before the IRS. By signing the Form 2848, the taxpayer is authorizing the eligible representative to receive confidential tax information and to perform the acts specified on the form, subject to any modifications made by the taxpayer, for the types of tax, tax forms, tax periods, and tax matters specified by the taxpayer on the form. See IRM 21.3.7 for the elements of a valid Form 2848.


    Taxpayers should use Form 8821, Tax Information Authorization, to authorize an individual to inspect or receive confidential tax information or Forms 4506 or 4506T to request a copy of a transcript. Beginning March 2004, the Service stopped recognizing an invalid Form 2848 as a valid tax information authorization.

  3. Form 2848 is also used to appoint an unenrolled return preparer to represent a taxpayer in limited circumstances. The authority granted to an unenrolled return preparer cannot exceed that allowed under the special rules of limited practice described in Revenue Procedure 81-38. See IRM

  4. The IRS will accept a power of attorney other than a Form 2848, provided the power is in writing and it contains the necessary elements, as described below. A completed transmittal Form 2848 must be attached, however, in order for the POA to be processed to the Centralized Authorization File (CAF) system.

  5. If a non-IRS document is used, it must contain the following information:

    1. The taxpayer's name and mailing address.

    2. The taxpayer's social security number and/or employer identification number.

    3. The taxpayer's employee plan number, if applicable.

    4. The name and mailing address of the representative.

    5. The type(s) of tax involved (i.e., income) and the federal tax form number.

    6. The specific year(s) or period(s) involved.

    7. For estate tax matters, the decedent's date of death.

    8. A clear expression of the taxpayer's intent concerning the scope of authority granted to the representative.

    9. The taxpayer's signature and date.


      "State law powers of attorney" may, or may not, be sufficient for IRS purposes, depending upon whether items (e) through (h) above are included.

  6. A signed and dated statement made by the representative should also be attached to the non-IRS POA. The statement must contain the same declarations contained in Part II of Form 2848.

  7. An electronic record of an authorization is maintained on the Centralized Authorization File (CAF). See IRM, The Centralized Authorization File (CAF).


    The issuance of a CAF number is merely an administrative act for internal recordkeeping and does not confer a right to practice upon an individual who is not qualified.  (06-01-2010)
Limited Practice Based on Relationship to the Taxpayer

  1. An individual may represent himself/herself before the IRS by presenting satisfactory identification. The individual does not have to file a written declaration of authority.

  2. Because of their special relationship with a taxpayer, unenrolled individuals can represent the specified taxpayers identified below before the IRS without having actually prepared the tax return in question. They must provide satisfactory identification and documented authority (e.g., Form 2848) to represent the taxpayer:

    1. A family member - an individual may represent members of his/her immediate family. Immediate family generally means a spouse, child, parent, brother or sister of the individual. In other cases, the determination of whether an individual is a member of a taxpayer’s immediate family can be complex, and the Office of Associate Chief Counsel (General Legal Services) or the Office of Associate Chief Counsel (Procedure and Administration) should be consulted.

    2. An officer - a bona fide officer of a corporation (including a parent subsidiary or other affiliated corporation), association or organized group may represent the corporation, association or organized group. An officer of a governmental unit, agency, or authority in the course of his/her official duties, may represent the organization before the IRS.

    3. A partner - a general partner may represent the partnership before the IRS.

    4. An employee - a regular full-time employee may represent his/her employer. An employer may be, but is not limited to, an individual, partnership, corporation (including a parent, subsidiary, or other affiliated corporation), association, trust, receivership, guardianship, estate, organized group, governmental unit, agency, or authority.

    5. A fiduciary (trustee, executor, administrator, receiver, or guardian) - a fiduciary stands in the position of a taxpayer and acts as the taxpayer, not as a representative.  (06-01-2010)
Referral to the Office of Professional Responsibility

  1. If you suspect a practitioner of misconduct, you should make a referral to the Office of Professional Responsibility (OPR). OPR is responsible for instituting disciplinary action against practitioners. Possible sanctions for violations include reprimand, censure, suspension or disbarment against a practitioner. OPR also may seek a monetary penalty against the practitioner and, under some circumstances, the practitioner’s employer or firm. Finally, OPR may seek Department of Justice action to obtain an injunction.

  2. Examples of misconduct include:

    1. Failure to exercise due diligence in statements or representations to a client or to the IRS.

    2. Causing unreasonable delays.

    3. Demonstrating incompetence and disreputable conduct (e.g., giving false or misleading statements, or diverting payments intended for IRS)

    4. Failure to file a federal tax return

    5. Engaging in contemptuous conduct (e.g., abusive language, making false accusations, or circulating malicious or libelous matter)

    6. Attempting to influence the official action of an IRS employee (e.g., threats, coercion or gifts).

    7. Issuing written advice such as tax opinions, that fails to comply with applicable standards.

  3. Certain violations such as threats or evasion of taxes should also be referred to Treasury Inspector General for Tax Administration (TIGTA) or Criminal Investigation (CI)I.

  4. Each referral should describe and document the practitioner's actions in order to support disciplinary action. Include a summary of the suspected misconduct that provides as much detail as possible regarding the misconduct in question and supporting documentation. Exhibit 1.25.1-1 provides instructions on how to make a referral that is"actionable" , i.e., a referral that is complete and provides as much information about the alleged misconduct as reasonably possible.

  5. Once you make a referral, OPR will contact you within 30 days to acknowledge the referral and follow up with a request for information. As the case progresses, OPR may need additional information and cooperation from you, other field offices, or other parts of the Service.

  6. OPR’s response to the referral will correspond to the seriousness of the alleged misconduct. For example, under certain circumstances, OPR may simply contact a tax practitioner to discuss the matter informally. Such an informal contact may stop the offending behavior. In other cases, OPR will investigate the matter further, issue a more formal contact to the practitioners, attempt a formal settlement, and, if necessary, initiate an action for the practitioner’s disbarment from practice before the IRS. Most cases are resolved at a point between those two extremes. To proceed on any case, OPR must have enough information to clearly frame the allegations, understand the severity of the action, and place it within the framework of Treasury Department Circular No. 230.

  7. Contact your Area Return Preparer Coordinator (RPC) to assist you with OPR referral issues for they may be aware of other issues involving the same practitioner. Also provide a copy of your OPR referral to the Area RPC. See http://nhq.no.irs.gov/opr/ .

  8. Announcements of censures, disbarments and suspensions normally are published in the Internal Revenue Bulletin. A practitioner who has been disbarred or suspended is not permitted to appear before the examiner as an advocate with or without the taxpayer. Suspended or disbarred practitioners may prepare returns and appear as a witness for the taxpayer under Rev. Proc. 68-29, 1968-2 C.B. 913.  (06-01-2010)
Responsibilities of the Joint Board for the Enrollment of Actuaries (JBEA)

  1. The Joint Board for the Enrollment of Actuaries (JBEA) administers the enrolled actuary program and processes applications for those seeking Enrolled Actuary status.

  2. In processing applications for enrollment and renewal, JBEA interacts with actuaries, employers, and Joint Board Members to resolve applicant issues.

  3. The JBEA processes Form 5434, Application for Enrollment , performs employment verifications and issues enrollment certificates to all applicants who qualify for Enrolled Actuary status and are approved by the Joint Board Members. At the point that enrollment letters are issued, the Enrolled Actuary is placed in Active status and is able to practice before the service.

  4. JBEA also processes Form 5434-A, Application for Renewal of Enrollment, for all eligible Enrolled Actuaries. Renewal of enrollment is required every three years for all enrolled and retired actuaries.

Exhibit 1.25.1-1 
How to Make a Referral to the Office of Professional Responsibility (OPR)

1. To make a referral to OPR, complete Form 8484 or write your own. (Form 8484 provides a good structure and ensures that OPR has all the information it needs. A fillable (Adobe Acrobat) Form 8484 is available on the Forms and Publications website http://publish.no.irs.gov/cat12.cgi?request=CAT2&itemtyp=F&itemb=8484&items= . Mail your referral and supporting documentation to:

Office of Professional Responsibility SE:OPR
Internal Revenue Service
1111 Constitution Avenue, N. W.
Washington, DC 20224

2. Include in the referral:

a. The practitioner’s name, address and telephone number
b. The practitioner’s taxpayer information number or employer identification number (if applicable)
c. The name, title, office, and telephone number of the referring employee.
d. A plain English description of the practitioner's offense—no jargon or shorthand—presented in a straightforward manner. Avoid words that characterize the behavior, or emotionally charged language. When available, notes or records made at or about the time of the event are more helpful than a later statement of someone’s recollections of the event. For example, it would be appropriate to say, Practitioner "X" submitted a false statement regarding Taxpayer "Y’s" business expenses. Since Practitioner "X" provided business accounting services to Taxpayer "Y" , he was in a position to know the information was not true. A statement that Practitioner " X" knowingly submitted a fraudulent return is generally not appropriate, unless it is based on a completed criminal prosecution or preparer penalty case.
e. The broad class of misconduct, including
misconduct arising while representing a taxpayer,
misconduct arising from the practitioner’s preparation of a taxpayers' return,
misconduct not directly involving IRS representation.
f. Manager’s review and approval (by signature and date (as required in Part E of Form 8484).


Treasury Department Circular No. 230 contains the rules and regulations governing attorneys, certified public accountants, enrolled agents, enrolled actuaries and appraisers who represent taxpayers before the IRS. You can review the various sections of Circular 230 listed below for more information on the standards to which tax professionals are held.

3. Use the following questions and suggestions to help you:

  Did the Practitioner For Example Your referral mustinclude--
1. Fail to exercise due diligence? Was the conduct:
• More than a simple error but less than willful or reckless misconduct?
• Negligence?
All of the basic information and explain why you believe the practitioner’s submission was below the expected standard.
See Circular 230 Section 10.22(a).
2. Cause an unreasonable delay in the prompt disposition of any matter before the IRS? Miss appointments?
Not follow through on promised documentation?
Hinder the Service in processing the case?
All of the basic information and a chronology of all significant events in the case (OPR looks for a pattern of practitioner behavior rather than scheduling conflicts and "dropped balls" that routinely occur).
See Circular 230 Section 10.23.
3. Demonstrate incompetence and disreputable conduct? Give false or misleading information or participate in any way in the giving of false or misleading information in connection with any matter pending or likely to be pending before the IRS?
Divert payments intended for IRS or a refund due the taxpayer? This should also be reported to TIGTA.
Information about where the legal argument put forth by the practitioner is patently false, or where there was a clear misstatement of fact made to IRS personnel.
Demonstrate why the argument is false or why the statement made was egregious in nature.
Provide any and all documentation to support diversion of funds such as cancelled checks and account transcripts.
See Circular 230 Section 10.51(d) & (g).
4. Did the practitioner fail to file a Federal tax return or evade the assessment of any Federal tax? Knowingly:
Counsel or suggest to a client or prospective client an illegal plan to evade Federal taxes or tax payment?
Omit income from his/her own or a client’s Federal income tax return?
All of the basic information, including whether it was failure to file a Federal income tax return or failure to pay taxes when due.
An annotated transcript of the accounts highlighting the relevant information (income omitted, penalties assessed and ultimate outcome), if the issues pertain to omitted or underreported income.
Consider notifying Criminal Investigation (contact your area Fraud Referral Specialist to assist you in evaluating and developing your case).
See Circular 230 Section 10.51(f).
5. Did the practitioner engage in contemptuous conduct? Use abusive language or any other inappropriate conduct?
Make false accusations and statements knowing them to be false?
Circulate or publish malicious or libelous matter?
All of the basic information and a complete narrative account of the conduct.
Actual language used, copies of any correspondence employed to falsely accuse an employee of misconduct and a thorough recitation of the facts leading up to the situation. (It is important that the practitioner’s exact language be reported.)
See Circular 230 Section 10.51(k).
6. Directly or indirectly attempt to influence the official action of any officer or employee of the IRS? Use threats, false accusation, duress or coercion?
Offer you a gift, favor or thing of value to influence the outcome of a case?
First, report these cases to TIGTA. Once the investigation is completed, TIGTA should make a referral to OPR. You can assist both offices by ensuring your referral includes:
All of the basic information and a complete narrative account of the conduct.
A report of the practitioner’s exact language.
See Circular 230 Section 10.51(h).

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