Circular 230

Circular 230 sets out the Treasury Department regulations governing practice before the Internal Revenue Service. It applies to attorneys, certified public accountants, enrolled agents, enrolled actuaries, enrolled retirement plan agents, and other individuals who represent taxpayers before the Service, and it is enforced by the IRS Office of Professional Responsibility.

Its provisions address duties and restrictions. Practitioners must promptly submit records requested by the IRS, exercise due diligence in preparing and filing returns and in the accuracy of representations to both the Service and clients, and advise a client of any noncompliance, error, or omission that comes to their attention along with the consequences. They must not unreasonably delay the resolution of a matter. Written advice must be based on reasonable factual and legal assumptions, must consider all relevant facts the practitioner knows or reasonably should know, and must not rely on unreasonable representations or take into account the likelihood that a return will be audited.

Conflicts of interest are permitted only where the practitioner reasonably believes competent representation can still be provided, representation is not prohibited by law, and each affected client gives informed written consent, retained for at least three years. Contingent fees for return preparation are restricted, permitted in defined circumstances such as examination and judicial proceedings. Sanctions range from censure and monetary penalties to suspension and disbarment from practice before the Service.

Circular 230 sits alongside, and should not be conflated with, the AICPA Code of Professional Conduct and the Statements on Standards for Tax Services, which impose their own obligations on members. Practitioners in a Big Four or regional firm environment are subject to all three regimes simultaneously, plus state board rules and, for audit clients, PCAOB and SEC independence requirements.