Regulations amending Circular 230 governing practice before the Internal Revenue Service: May 3, 2005.

On May 3, 2005, TEI filed the following comments with the Department of the Treasury and the Internal Revenue Service concerning recent amendments to Circular 230, which sets forth rules for "practice before the IRS." The Institute's comments and recommendation focus on in-house tax professionals, their distinct role, and the importance of developing rules applicable to this group of tax practitioners.

On behalf of the Tax Executives Institute, I respectfully submit the following comments related to the recent regulations amending Circular 230 governing practice before the Internal Revenue Service. 69 Fed. Reg. 75,839 (Dec. 20, 2004); 31 C.F.R. [subsection] 10.33, 10.35, 10.36, 10.37, 10.38 & 10.52. As discussed during TEI's recent liaison meetings with the Commissioner, officials of the Office of Tax Policy and the Office of Chief Counsel, and separate conversations with representatives of the Office of Professional Responsibility, TEI recommends that the regulations be modified to acknowledge "in-house tax professionals" as a distinct category of tax professionals. We elaborate on our recommendation below.

About TEI

TEI is the preeminent association of business tax executives in North America with approximately 5,700 members representing 2,800 of the leading corporations in the United States, Canada, Europe, and Asia. TEI represents a crosssection of the business community, and is dedicated to the development and effective implementation of sound tax policy, to promoting the uniform and equitable enforcement of the tax laws, and to reducing the cost and burden of administration and compliance to the benefit of taxpayers and the government alike. As a professional association, TEI is firmly committed to maintaining a tax system that works--one that is administrable and with which taxpayers can comply.

Background

On December 17, 2004, the Treasury Department published final regulations amending the tax shelter provisions of Circular 230, which imposes duties on practitioners representing taxpayers before the Internal Revenue Service. Scheduled to become effective on June, 20, 2005, these regulations represent the most recent development in the Treasury Department's continuing effort to deter abusive tax shelters and otherwise enhance professionalism among tax practitioners. We applaud the efforts and support reasonable measures to deter the use of tax shelter schemes. The latest amendments to Circular 230, however, if left unchanged, will...