Question

Please summarize Circular 230. Thank you!

Answer 1

Answer:

Circular 230 is a hybrid document which contains rules, regulations, moral and disciplinary guidelines and regulation applicable to persons practicing before the IRS.

This circular is a US publication. These rules apply to those qualified and authorized to prepare tax returns and give legal advice for certain things within the field, including this San Diego Tax Advisor. Treasury rules that include rules govern licensed professional practice before the Internal Revenue Service. The rules encourage certain behavior and prohibit it. Penalties are evaluated when a member admitted is not compliant. In view of this, Circular 230 rules apply to lawyers, certified government accountants, registered agents, registered actuarials, evaluators and retires plan officers registered.

Until 2011, anyone could produce a tax return and/or give tax advice without being liable in accordance with Circular 230 (instead of being subject to civil and criminal penalties). Nonetheless, several rules were implemented from January 2011 on persons engaged in the preparation of US tax returns for oversight by the IRS. The Internal Revenue Service is only allowed to serve its clients through attorneys, CPAs, government officers, actuaries or government pension plan agents. Representation includes contact with IRS on consumer problems, even when the consumer is not present. In Circular 230, however, there are a few exceptions to this statute. For example, before the IRS, a family member can (with authorisation) represent another family member. Furthermore, a company officer can represent the company before the IRS.

In the preparation of tax reports, Circular 230 also provides rules for professional conduct. Every person who prepares a tax return must take a view of a tax return. This is not permissible to file a frivolous tax return. Furthermore, there are no excessive delays. It is prohibited to charge a fee for an original return based on the results of any position. The professional may, however, charge the contingent fees permitted for modified returns and for those positions being examined in relation to the judicial procedure.