DC currents: the RPO, OPR, and circular 230.

• Author: Goldstein, Benson S.
• Position: Return Preparer Office, Office of Professional Responsibility

THE PAST TWO YEARS HAVE BEEN EXTREMELY hectic and perhaps disconcerting for tax return preparers and other tax professionals. During the 2011 and 2012 filing seasons, the IRS has phased in the preparer mandate for e-filing of individual, trust, and estate tax returns. The mandate has contributed to the Service's success in increasing the e-filing rate to 79%. To top that off, the IRS established the Return Preparer Office (RPO) in 2010 by naming David R. Williams the director in charge of the new post.

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Commissioner Douglas Shulman made the RPO responsible for administering the preparer tax identification number (PTIN) process and the programs involving enrolled agents (EAs), registered tax return preparers (RTRPs), and other enrolled professionals. For example, the RPO is responsible for testing, continuing education, and renewal procedures for the EA and RTRP programs. The IRS released final regulations (T.D. 9527) on May 31, 2011, making amendments to Circular 230, effective August 2, 2011, that (in part) accommodate the IRS's internal structural changes by providing the commissioner authority to delegate necessary duties to appropriate IRS offices. While these amendments validate Shulman's transfer of certain responsibilities to the RPO that were previously under the direction of the IRS Office of Professional Responsibility (OPR), the OPR will continue to enforce the provisions under Circular 230 relating to practitioner conduct and discipline. According to the preamble to T.D. 9527, the OPR "will continue to carry out its mission to interpret and apply the standards of practice for tax professionals in a fair and equitable manner. ... [A] strong enforcement regime is a key component to increased oversight of the tax return preparer industry."

OPR Independence and Authority

OPR Director Karen Hawkins has made public speeches in recent months highlighting the need for the OPR to maintain its in dependence or distance from the commissioner's tax enforcement responsibilities. In effect, Hawkins wants to avoid what she views as a potential conflict of interest with the IRS's enforcement functions. The tax press has reported that practitioners believe disciplinary authority should re side with the OPR, in contrast to the RPO, which is part of the commissioner's office.

Circular 230, Regulations Governing Practice Before the Internal Revenue Service (31 C.F.R. Part 10), spells out the scope of the OPR's disciplinary...