Who enforces Circular 230?

Circular 230 is enforced by the IRS Office of Professional Responsibility (OPR). The OPR investigates complaints about tax practitioners, conducts disciplinary proceedings, and can issue sanctions including censure (a public reprimand), suspension from IRS practice for a fixed or indefinite period, disbarment, monetary penalties, and disqualification of appraisers. Practitioners under suspension or disbarment cannot represent taxpayers before the IRS until reinstated by the OPR.

What are the most important duties Circular 230 imposes on tax practitioners?

Key Circular 230 duties include: exercising due diligence in preparing, assisting, and approving tax returns and documents; not knowingly taking frivolous positions; promptly correcting known errors on prior submissions; not unreasonably delaying a proceeding; advising clients of noncompliance and the potential consequences; and maintaining the confidentiality of client information. Tax practitioners must also not represent clients whose interests directly conflict with each other without informed written consent.

Why do tax documents sometimes include Circular 230 disclaimers?

Until 2014, Circular 230 required specific disclaimers in written tax advice about covered opinions. The IRS eliminated the written advice requirements in 2014 and the formal 'Circular 230 disclaimers' seen on emails and memos are no longer required. You may still see them on older documents or from practitioners who have not updated their templates, but they no longer carry the regulatory significance they once did.