1.1.20 Office of Professional Responsibility

Manual Transmittal

November 29, 2016

Purpose

(1) This transmits revised IRM 1.1.20, Organization and Staffing, Office of Professional Responsibility (OPR).

Material Changes

(1) Made editorial updates throughout.

(2) Reviewed and updated roles and responsibilities, as necessary.

(3) Reviewed and updated website addresses, legal references and IRM references, as necessary.

Effect on Other Documents

IRM 1.1.20, dated June 30, 2015, is superseded.

Audience

All Divisions and Functions

Effective Date

(11-29-2016)

Stephen A. Whitlock
Director, Office of Professional Responsibility

Introduction to the Office of Professional Responsibility

  1. The Office of Professional Responsibility (OPR) is responsible for all matters related to practitioner misconduct, discipline and practice before the Internal Revenue Service (IRS) under 31 CFR Subtitle A, Part 10 (Circular 230, Regulations Governing Practice before the Internal Revenue Service) (“Regulations” or “Circular 230”). In carrying out this responsibility, the OPR administers the law and regulations governing the practice of tax professionals and other individuals who interact with the tax administration system on behalf of taxpayers, including, but not limited to, attorneys, certified public accountants, enrolled agents, enrolled actuaries, enrolled retirement plan agents, tax return preparers who represent clients before the IRS, and appraisers who provide valuations contained in documents submitted to the IRS.

  2. The OPR:

    1. Receives, reviews and investigates evidence of alleged misconduct by individuals covered by the Regulations.

    2. Evaluates allegations to determine whether they evidence actions which constitute disreputable or incompetent conduct, or otherwise reflect violations of the Regulations.

    3. When warranted, proposes and negotiates a level of discipline appropriate with the misconduct.

    4. In the absence of a Reprimand or a voluntary settlement, initiates disciplinary proceedings before Administrative Law Judges (ALJs).

    5. Initiates or responds to appeals of ALJ disciplinary decisions.

    6. Pursuant to Delegation Order 25-16 (Rev. 1), receives, processes, and investigates referrals of alleged misconduct under Rev. Proc. 81-38 and Rev. Proc. 2014-42 (or successor guidance), and makes final determinations of ineligibility of unenrolled tax return preparers to practice (in accordance with the applicable guidance).

    7. Serves as the Appellate Authority for enrollment appeals from the Return Preparer Office (RPO), pursuant to Delegation Orders 25-16 and 25-17.

    8. Interprets the Conference and Practice Requirements contained in 26 CFR 601, Subpart E.

    9. Provides education and outreach regarding a tax professional’s obligations and duties as enumerated in Circular 230.

    10. Acts in an advisory capacity with respect to IRS oversight and compliance initiatives and programs for tax professionals.

The Office of Professional Responsibility’s Mission

  1. The mission of the OPR is to interpret and apply the standards of practice for tax professionals in a fair and equitable manner. The OPR’s objective is to support effective tax administration by ensuring all tax professionals and other third parties interacting with the tax administration system on behalf of taxpayers adhere to the standards of practice and ethics enumerated in Circular 230. To achieve its mission, the OPR’s goals include:

    1. Increasing awareness and understanding of the tax practice standards contained in Circular 230 and the OPR’s oversight responsibilities through outreach and educational activities.

    2. Applying the principles of due process to the investigation, analysis, resolution, and administrative litigation of disciplinary cases.

    3. Facilitating frequent and open communication with tax professional organizations.

    4. Conducting regular and extensive outreach and educational activities for both internal and external audiences on all aspects of Circular 230 tax practice standards.

    5. Building, training, and motivating a cohesive OPR team.

  2. To achieve its goals and to carry out its mission, the OPR is committed to:

    1. Ensuring independent, fair and equitable treatment of all tax practitioners consistent with the OPR’s authority and principles of due process.

    2. Rendering fair and independent determinations regarding alleged misconduct in violation of Circular 230.

    3. Educating and reinforcing tax professionals’ knowledge of relevant Circular 230 provisions.

    4. Providing guidance and feedback to field and National Office IRS personnel regarding essential referral criteria for Circular 230 provisions.

    5. Strengthening partnerships with other divisions of the IRS and with external practitioner organizations.

    6. Maintaining procedures that ensure timely case resolution.

    7. Maintaining policies and guidelines that ensure fair and equitable disposition of Circular 230 cases.

    8. Developing and implementing proactive strategies for identifying violations of Circular 230.

Office of the Director

  1. The OPR includes the Office of the Director who supervises the following offices:

    • Legal Analysis Branch and

    • Operations and Management Branch.

  2. The Director, who reports to the Commissioner and to the Deputy Commissioner, Services and Enforcement, oversees administration and enforcement of Circular 230 provisions governing the conduct and discipline of the nation’s tax practitioners before the IRS. The Director conducts and oversees a comprehensive outreach program to the tax practitioner community, to inform them of Treasury/IRS rules, regulations, policies, and procedures pertaining to standards of conduct, integrity, and ethics, in order to practice before the IRS. The Director also provides executive direction in matters relating to human capital management and labor relations, the OPR budget, performance measures, operation and maintenance of the case inventory system and strategic planning.

Legal Analysis Branch

  1. The mission of the Legal Analysis Branch (LAB) is to receive information with respect to apparent or potential violations of the Regulations, review the submission, investigate the facts, analyze the results, and propose appropriate dispositions, including sanctions for confirmed misconduct.

  2. The LAB accomplishes the OPR mission by:

    1. Receiving, reviewing and evaluating referrals alleging violations of the Regulations from IRS field personnel, including the RPO, and other relevant external federal and state agencies.

    2. Evaluating allegations of misconduct to determine whether they indicate actions which constitute disreputable or incompetent conduct, or otherwise reflect violations of the Regulations.

    3. When warranted, proposing and negotiating a level of discipline appropriate with the misconduct.

    4. In the absence of a voluntary settlement, initiating disciplinary proceedings before ALJs pursuant to Circular 230 Section 10.60 et seq.

    5. Acting on referrals from state and federal licensing authorities, and on conviction information of state and federal courts by instituting expedited suspension proceedings pursuant to Circular 230 Section 10.82.

    6. Communicating with state licensing authorities, including state boards of accountancy and state bars, to seek and obtain information on state disciplinary actions that have Circular 230 implications.

    7. Working closely with IRS Business Operating Divisions and Functions to obtain information necessary to thoroughly investigate, analyze, and interpret a referral of a practitioner for possible Circular 230 violations.

Operations and Management Branch

  1. The Operations and Management Branch (O&M) of the OPR is responsible for providing program support to the organization’s mission through strategic planning, employee training, information technology, stakeholder outreach and communication, human capital planning and execution, and finance.

  2. The strategy function within O&M ensures proper execution and coordination of the OPR’s strategy as set by the Office of the Director each year. The strategy function coordinates with the LAB to ensure the OPR’s strategy is implemented consistently across the organization and that all strategic goals and objectives are properly and timely met. The strategy function is responsible for monitoring the execution of the Operational Plan, Continuity of Operations Plan, Business Resumption Plan, and the Concept of Operations.

  3. The O&M branch accomplishes the OPR mission by:

    1. Packaging and disseminating strategic plan information across the OPR. Other key activities associated with this function include review of the IRS strategic plan to identify and implement necessary changes.

    2. Meeting with the OPR senior leadership to discuss shifts in strategic direction at the organizational level and updating the OPR’s Standard Operating Procedures and Internal Revenue Manual sections to reflect necessary changes.

    3. Monitoring the OPR’s overall performance and particular accomplishments to ensure that each supports accurate and current objectives.

    4. Developing employee training programs and directing the analysis, development, and method of delivery necessary to achieve and maintain optimal employee knowledge, skills and job performance.

    5. Ensuring processes, technology, and other mechanisms are in place to effectively track referrals, investigations, Circular 230 determinations, disciplinary recommendations and final case dispositions.

    6. Analyze and utilize technology driven data to better inform and educate operating divisions and IRS personnel regarding referral obligations under Section 10.53 of Circular 230.

    7. Developing and distributing communications to both internal and external stakeholders as well as the OPR employees.

    8. Providing guidance to agency employees and members of the general public regarding the OPR's mission, vision, goals and processes, and maintaining liaison with the IRS Business Operating Divisions and Functions and with external agencies.

    9. Developing and analyzing data needed to evaluate organizational efficiency, and performing advanced data analysis when necessary to inform training needs, performance improvement activities and the bases for business results reporting.

    10. Directing human capital planning, execution and finance by ensuring that the OPR's current staffing levels are sufficient to meet the identified workload and agency needs.

    11. Responding to oversight inquiries from the Treasury Inspector General for Tax Administration and the U.S. Government Accountability Office.

    12. Operationalizing a Risk Management Program.

    13. Requesting contractor support, managing the contract financials, and acting as a liaison between the contracting agency and the IRS for interagency contracts with other government agencies and blanket purchase agreement contracts for external parties.

Definition of Terms

  1. Attorney: Any person who is an active member in good standing of the bar of the highest court of any State, territory or possession of the United States, including a Commonwealth, or the District of Columbia. Attorneys may, subject to certain limitations, perform all acts the taxpayer can perform with respect to the tax matters authorized.

  2. Certified Public Accountant (CPA): Any person who is duly qualified to practice as a CPA in any State, territory or possession of the United States, including a Commonwealth, or the District of Columbia. CPAs may, subject to certain limitations, perform all acts the taxpayer can perform with respect to the tax matters authorized.

  3. Enrolled Agent (EA): Any individual who has demonstrated special competence in tax matters and has been issued an enrollment card by the IRS. Except for limited enrollment of certain former IRS employees based on the extent of their former work experience, EAs may, (subject to some limitations), perform all acts the taxpayer can perform with respect to the tax matters authorized.

  4. Enrolled Actuary (EAc): Any individual who has demonstrated competence in specific matters under the internal revenue laws, as enumerated in Circular 230, has applied for enrollment and been issued an enrollment card by the Joint Board for the Enrollment of Actuaries. Practice as an EAc is limited to the specific competency areas enumerated in Circular 230.

  5. Enrolled Retirement Plan Agents (ERPA): Any individual who has demonstrated competence in specific matters under internal revenue laws, as enumerated in Circular 230, has applied for enrollment, and has been issued an enrollment card by the IRS. Practice as an ERPA is limited to the specific competency areas enumerated in Circular 230.

  6. Tax Return Preparer: Any individual who is compensated to prepare tax returns for others and who has applied for and maintains a valid Preparer Tax Identification Number (PTIN) issued by the IRS. Practice as a tax return preparer is limited to representing taxpayers before revenue agents, examiners, customer service representatives, and the Taxpayer Advocate Service during an examination of tax returns or claims for refund prepared and signed by the tax return preparer. Effective for tax returns and refund claims prepared on or after January 1, 2016, only tax return preparers who also earn an IRS Annual Filing Season Program Record of Completion pursuant to Revenue Procedure 2014-42 may engage in the aforementioned limited practice before the IRS.

  7. Appraiser: Any individual who provides valuations contained in submissions to the IRS.

  8. Others who interact with the tax administration system: Individuals engaging in limited practice before the IRS under Section 10.7(c) of Circular 230, individuals granted special appearance authority under section 10.7(d), and individuals granted temporary recognition as an EA under section 10.5 (e).

Resources

  1. Internal OPR Website: http://irweb.irs.gov/AboutIRS/bu/opr/default.aspx

  2. External OPR Website: http://www.irs.gov/Tax-Professionals/Circular-230-Tax-Professionals

  3. Treasury Department Circular No. 230 (Rev. 6-2014), Regulations Governing Practice before the Internal Revenue Service: http://core.publish.no.irs.gov/othergov/pdf/td_circular_230--2014-06-00.pdf

  4. Announcements of Disciplinary Sanctions in the Internal Revenue Bulletin: http://www.irs.gov/portal/site/irspup/menuitem.143f806b5568dcd501db6ba54251a0a0/?vgnextoid=8272cd489f916310VgnVCM100000351f0a0aRCRD&vqnextchannel=8a9246d964264310VgnVCM1000004e0d010a____

  5. Title 31 United States Code Section 330: http://uscode.house.gov/search/criteria.shtml

  6. Title 5 United States Code Section 500: http://uscode.house.gov/search/criteria.shtml

  7. Title 26 Code of Federal Regulations, Part 601, Subpart E: https://www.law.cornell.edu/cfr/text/26/part-601/subpart-E

  8. Revenue Procedure 81-38, Limited Practice Without Enrollment: https://www.irs.gov/pub/irs-utl/rev_proc_81_-_38_2.pdf

  9. Revenue Procedure 2014–42, Annual Filing Season Program: http://www.irs.gov/irb/2014-29_IRB/ar14.html

  10. Notice 2007-39, IRB 2007–20, Disciplinary Actions Under Section 822 of the American Jobs Creation Act of 2004: http://www.irs.gov/irb/2007-20_IRB/ar07.html

  11. News and Updates from the OPR: http://www.irs.gov/Tax-Professionals/Subscribe-to-News-and-Updates-from-OPR