General. General Legal Services advises and represents the Office of Professional Responsibility (OPR). See CCDM 30.3.2.3.4. This section governs the handling of suspension and disbarment proceedings recommended by OPR. This section also governs the handling of matters pertaining to limited practice by tax return preparers and the Joint Board for the Enrollment of Actuaries, see CCDM 39.4.1.7, Cases Originating with the Joint Board for the Enrollment of Actuaries. The section also provides information on the Service’s conference and practice requirements and powers of attorney.

Disclosure. In connection with claimant representative matters, GLS Area Counsel and Branch Chiefs may disclose returns and return information as provided by section 6103(l)(4). GLS attorneys directly involved in such matters may also exercise this authority, unless restricted by a manager. With respect to testimony authorizations for non-tax judicial and administrative proceedings in which the Government or IRS is a party, see Commissioner Delegation Order 11-2 (formerly D.O. 156). Novel, unclear, or sensitive disclosure issues must be coordinated with the Office of Assistant Chief Counsel (Disclosure and Privacy Law).

The litigation of disciplinary cases under Treasury Department Circular 230 is a responsibility of the Office of Associate Chief Counsel (GLS), which is primarily performed by Area Counsel GLS. The Service’s Office of Professional Responsibility refers these cases to GLS for litigation. Many of the provisions that follow are by agreement with the Service. The following instructions do not replace a thorough understanding of the rules specified in Circular 230, but are only a summary.

Referral of Cases by OPR. The decision to institute a disciplinary proceeding is the prerogative of OPR. Once OPR requests a disciplinary proceeding, the case is sent to Area Counsel for legal review. OPR will refer disciplinary cases to the GLS Area Counsel in whose geographic area the subject practitioner (practitioner) resides. OPR will transmit file materials in an orderly fashion, with appropriate prong-filing, indexing, and tabbing.

Point of Contact. Prior to OPR’s referral of the case, OPR will be the point of contact with the practitioner. After referral, GLS will have responsibility for all communication with the practitioner. If the practitioner contacts OPR after the referral, such contact will be referred to the GLS attorney for appropriate handling.

Update of Information. OPR is responsible for updating all relevant file information prior to the referral of the case to GLS. Examples of the information that needs to be updated include, but are not limited to:

Notification of Referral. OPR will advise the GLS Area Counsel and the Ethics and General Government Law Branch (EGG) by email of the particulars of the transmittal (i.e., name of case, date sent, and addressee).

Case Assignment. Upon receipt of the file materials, GLS Area Counsel will assign the case to an attorney and, within seven days, notify OPR and EGG via email of the receipt of the file and the assignment of the attorney. As part of the assignment process, GLS will enter the case into CASE-MIS. Whenever a case is transferred to another attorney, the new attorney will promptly advise the OPR and EGG.

Initial Review. Within 28 days of the receipt of the case, the GLS attorney will review the case file and contact OPR to discuss any transmittal issues, any related litigation questions, and the need for any additional documents or other information. The responsible GLS attorney will advise the OPR of any substantive problems with the litigation. The responsible GLS attorney will also advise EGG of any problems with either the OPR’s transmittal or important substantive aspects of the case. OPR is responsible for obtaining any additional information as requested by GLS throughout the litigation. The GLS attorney must be available throughout the litigation to discuss the case and related issues with OPR.

Coordination. When reviewing the case, Area Counsel attorneys should coordinate any novel, unclear, or sensitive issues with the Ethics and General Government Law Branch. Where Area Counsel (GLS) requires tax law assistance in understanding the facts of, or developing positions concerning, a case in litigation (or being considered for litigation) under Treasury Department Circular 230, Office of Division Counsel (Small Business and Self Employed) will provide such assistance. Area Counsel (GLS) should request the assistance from the local Area Counsel (Small Business and Self Employed). In doing so, ask the Area Counsel (SBSE) to confirm that the attorney who will be rendering the assistance has no pending matters with the practitioner (as taxpayer or representative). If the SBSE attorney assigned has a pending matter with the practitioner, another SBSE attorney should be assigned. This is intended to avoid the circumstance where a taxpayer or taxpayer representative could allege that the disciplinary procedure is being used as leverage to obtain a favorable settlement or capitulation on a contested tax liability. When reviewing the case, Area Counsel attorneys should coordinate any novel, unclear, or sensitive issues, or any issue that may require a uniform approach, with the Ethics and General Government Law Branch, which, in turn, will coordinate with the Office of Associate Chief Counsel (P&A) on any issue that can be expected to impact a matter of tax administration.

Additional Information. If the GLS attorney needs additional information from OPR to complete the review required by paragraph (7), OPR will provide such information in a timely fashion.

Procedures after Initial Review: Prefiling Letter. No later than seven days after completing the initial review required by paragraph (7) above and having received any information requested from OPR under that paragraph, the GLS attorney must send a letter to the practitioner. This letter will advise the practitioner that OPR has forwarded the case to the Office of Chief Counsel for litigation and that a complaint will be filed promptly in the absence of a settlement.

Procedures Prior to Filing of Complaint. Before filing the complaint, the GLS docket attorney will allow the practitioner 21 days to respond. If the practitioner responds in good faith to the letter within 21 days, then the GLS docket attorney has another 21 days in which to negotiate a settlement. Any additional time to negotiate a settlement must be approved by the appropriate point of contact for OPR.

Settlement Parameters. OPR must provide GLS with the settlement parameters for the case when it refers the case. If the practitioner proposes a settlement within these parameters, GLS is authorized to settle without further contact with OPR. The GLS attorney will discuss with the appropriate OPR contact any good-faith settlement offers made by the practitioner that are outside the parameters set by GLS when the case was initially referred.

Preparing and Issuing the Complaint. If settlement is not reached, the GLS docket attorney will issue a complaint within 21 days after the expiration of the time permitted for settlement under paragraph (11). Prior to issuance of the complaint, the GLS attorney will obtain a complaint number from OPR. A complaint must provide a clear and concise statement of the facts and the law that are the basis for the proceeding. The complaint is sufficient if it fairly informs the respondent of the charges against him or her so that he or she is able to prepare the defense. The complaint must specify the sanction sought, and an answer must be demanded, either in the compliant complaint itself or in a separate paper attached to the complaint (as required by 31 C.F.R. § 10.62(c)). The complaint must allege that the respondent has engaged in practice before the Internal Revenue Service and was eligible to so practice at the time of the alleged violation. Service of the complaint is made by certified mail sent to the practitioner’s last known address as determined under I.R.C. § 6212. If such service fails or is impossible, the assigned attorney will arrange for personal or other service as authorized under Circular 230. When the assigned attorney expects certified mail delivery to fail, another method of service may be attempted simultaneously. See 31 C.F.R. §§ 10.62-10.63 for detailed rules concerning complaint contents, service and filing.

Copies of Pleadings. The GLS attorney will send copies of all pleadings to OPR, which will maintain the official records of all OPR-related litigation.

Advice Unrelated to Imminent or Pending Litigation. With respect to local matters and issues that arise with agency employees and components in their geographic area, Area Counsel attorneys will provide advice on the authorities specified in section 39.4.2. These matters include actions under the rules of practice in Circular 230, the rules of limited practice in Rev. Proc. 81-38, and, where issues under GLS jurisdiction are implicated, actions taken on electronic return originators and other electronic filing program participants. With respect to novel, unclear, or sensitive issues, Area Counsel will coordinate with the Ethics and General Government Law Branch.

Other Litigation Support. With regard to matters under the enrollment provisions of Circular 230 or Rev. Proc. 81-38, Area Counsel attorneys will provide litigation support to DJ on cases filed in District Courts in their geographic areas. GLS generally does not lead in providing litigation support to DJ regarding discipline in the e-file program. GLS will refer e-file cases to the appropriate Division Counsel office, but will provide assistance to Division Counsel on any GLS matter (e.g., e-file conduct rules drawn from or analogized from Circular 230).

For coordination requirements for matters involving tax administration or Circular 230-related guidance, see CCDM 39.4.1.4.1.

Ethics and General Government Law Branch Responsibilities. The Ethics and General Government Law Branch provides advice to OPR and other Service personnel regarding practice before the Internal Revenue Service. Advice involving the interpretation of the regulations governing practice before the Internal Revenue Service (Circular 230) will be coordinated as specified in this section.

Post-employment Practice Advice. Advice concerning post-employment practice by former Government employees, their partners, and their associates is the responsibility of the Ethics and General Government Law Branch. Such advice includes, but is not limited to, advice on the Circular 230 isolation requirement for firms employing former officials of the Service and Counsel. See Exhibit 39.4.1-1 and Exhibit 39.4.1-2 (model isolation statements). Such advice would also include any issues arising under the Ethics in Government Act, or interpretation of provisions falling within 18 U.S.C. Part I, Ch. 11, or any issue affecting the duties of the Deputy Ethics Official responsibilities of the Associate Chief Counsel (GLS).

Case Coordination. The Ethics and General Government Law Branch serves as the point of contact for coordination of OPR litigation.

Litigation Support. GLS Headquarters, operating through the Ethics and General Government Law Branch, provides litigation support to DJ on appealed OPR cases not otherwise covered by Area Counsel.

Reference Materials. The statutes, regulations, official guidance, and other papers listed below are core reference materials for matters addressed by this chapter.

Law Governing Practitioners. Described below are the principal statutes controlling practitioners before the IRS.

Regulations. The Secretary of the Treasury has promulgated regulations governing the practice of attorneys, certified public accountants, enrolled agents, enrolled actuaries, and certain others before the IRS. See Title 31, Code of Federal Regulations, Subtitle A, Part 10, issued in pamphlet form as Treasury Department Circular No. 230 ("Circular 230" ). The Office of Professional Responsibility (OPR) administers and enforces Circular 230 under delegated authority of the Secretary of the Treasury.

Composition of Joint Board. The Joint Board for the Enrollment of Actuaries (Joint Board) is composed of five members — three appointed by the Secretary of the Treasury and two appointed by the Secretary of Labor. In addition, the Pension Benefit Guaranty Corporation has one representative with no voting power. The Executive Director of the Joint Board for the Enrollment of Actuaries is responsible for administering the enrolled actuary program and conducting disciplinary proceedings.

Responsibilities of Joint Board. Under 29 U.S.C. § 1242(a), the Joint Board is authorized to establish reasonable standards and qualifications for the enrollment of persons performing actuarial services with respect to the Employee Retirement Income Security Act of 1974 (ERISA). The Joint Board has adopted regulatory standards and qualifications for persons performing actuarial services covered by ERISA. The Joint Board enrolls individuals who satisfy such standards and qualifications.

Disciplinary Action. Under 29 U.S.C. § 1242(b), the Joint Board has disciplinary authority over enrolled individuals. The Joint Board may, after notice and an opportunity for a hearing, suspend or terminate the enrollment of an individual under this section if the Joint Board finds that such individual:

Applicable Rules and Procedures. Regulations governing the Joint Board’s enrollment and discipline of enrollees are published in 20 C.F.R. Part 901. The procedures for suspension and termination of enrolled actuary status resemble those in Circular 230.

Litigation of Disciplinary Proceedings. GLS litigates Joint Board disciplinary proceedings. These proceedings are comparatively rare. To the extent feasible, Joint Board disciplinary proceedings will be handled as if they were a Circular 230 proceeding. Area Counsel will coordinate with the Ethics and General Government Law Branch when a Joint Board case is submitted for litigation.

Applicability of Circular 230. Enrolled actuaries practicing before the Service are subject to Circular 230 as well as the Joint Board Regulations. Conduct leading to discipline under the Joint Board regulations is also likely to constitute grounds for discipline under Circular 230.

Advice to Joint Board. The Office of Chief Counsel may be asked to advise the Treasury representatives to the Joint Board. For example, in the past, the Ethics and General Government Law Branch has provided advice on general government law questions. Such advice will be coordinated with the Associate offices as necessary.

General. Revenue Procedure 81-38, 1981-2 C.B. 592, specifies the conditions under which an income tax return preparer who is not otherwise a practitioner has the privilege of limited practice. Rev. Proc. 81-38 also specifies the scope of such limited practice, and special rules that apply to those engaging in limited practice.

Advice. GLS Area Counsel will provide advice to Service personnel regarding the administration of Rev. Proc. 81-38. With respect to novel, unclear, or sensitive issues, Area Counsel will coordinate a response with the Ethics and General Government Law Branch.

Litigation support. GLS will also support DJ when actions taken under Rev. Proc. 81-38 are challenged in District Court.

General. Regulations governing practice before the IRS (including the Office of Chief Counsel) are prescribed by Subpart E, Conference and Practice Requirements, of the IRS’s Statement of Procedural Rules (26 C.F.R. Part 601). The requirements are applicable to practice (including conferences) with respect to any matter involving any internal revenue tax. These regulations also specify the requirements for processing of powers of attorney. GLS Area Counsel will provide advice to Service and Counsel personnel regarding the Conference and Practice Requirements. Area Counsel attorneys should coordinate any novel, unclear, or sensitive issues with the Ethics and General Government Law Branch.

Advice that impacts tax administration. Advice regarding the Conference and Practice Requirements will often impact the jurisdiction of many offices within Chief Counsel. Where such advice is implicated, GLS Area Counsel will contact the Ethics and General Government Law Branch. The Ethics and General Government Law Branch will coordinate any practice issues affecting matters of tax administration with the appropriate contact within the Office of Associate Chief Counsel (P&A) or other effected function in the Office of Chief Counsel.

Policy. It is the policy of the Internal Revenue Service to encourage the discussion of disputed tax liability or any other matter in connection with an internal revenue tax which affects the taxpayer’s interests. In furtherance of this policy, conferences will be held with taxpayers or their duly authorized representative. The following items are a summary of the highlights of the regulations.

Persons to be Recognized as a Taxpayer’s Representative. No person may appear as a representative unless such person presents satisfactory identification and is recognized to practice before the Service. The following persons will be recognized to practice before the Internal Revenue Service:

Power of Attorney Required. In practice before the Service, a power of attorney in proper form, executed by the taxpayer, will be required when the taxpayer’s representative desires to perform one or more of the following services on behalf of the taxpayer:

Relationship to Tax Information Authorization (TIA). A TIA is a document signed by the taxpayer authorizing a representative to receive or inspect confidential tax information in a specified matter. A TIA is required from the taxpayer in order that a taxpayer’s representative may receive or inspect confidential tax information in a matter. If the taxpayer’s representative has filed a power of attorney with respect to one or more of the matters specified in paragraph (5) above, he or she will be entitled to receive or inspect confidential information in the same matter without being required to file a separate tax information authorization. A tax information authorization is not required of a taxpayer’s representative at a conference which is also attended by the taxpayer. Other instances in which a TIA is not required are listed in 26 C.F.R. § 601.502(c).

When Power of Attorney or Tax Information Authorization Must Be Filed. One copy of a power of attorney must be filed in each office of the IRS in which the representative, in connection with a matter in practice before the Service, desires to perform one or more of the acts enumerated in (5) above. If a power of attorney with respect to the matter has not been filed with the IRS, one copy of a tax information authorization must be filed in each office of the IRS in which the representative, in connection with the matter under consideration, receives or inspects confidential information.

Practice by Correspondence. If a representative desires to represent a taxpayer through correspondence with the IRS, such representative must submit a power of attorney, including the declaration of representative and any other required statement(s), even though no personal appearance is contemplated.

Formal Requirements for Powers of Attorney. The use of technical language in the preparation of a power of attorney is not necessary, but the instrument must include the information required by section 601.503 of the Conference and Practice Requirements, including a clear expression of the taxpayer’s intention as to the scope of the authority of the representative and specify the tax matter to which the authority relates. A power of attorney may relate to more than one matter. If the taxpayer wishes to authorize his or her representative to perform one or more of the acts set forth in paragraph (5) above, the power must clearly specify which acts the representative is authorized to perform. Where the customary Form 2848 is supplied, the form itself specifies that certain of these acts are authorized in the absence of a deletion by the taxpayer.

Certification of Copies. The IRS will accept either the original or a copy of a power of attorney. A copy of a power of attorney received by fax will also be accepted.

Bypass. When a taxpayer’s representative unreasonably delays or hinders an examination, collection, or investigation, Service personnel may seek authorization from their manager to contact the taxpayer directly. Bypass is not to be invoked lightly but may be considered when a representative fails to furnish, after repeated requests, nonprivileged information necessary to the examination, collection, or investigation. If bypass is authorized, the case file will be documented with sufficient facts to show how the examination, collection, or investigation was being delayed or hindered, and written notice of such permission, briefly stating the reason why it was granted, will be given to the representative and the taxpayer. See Treas. Reg. § 601.506(b); see also section 7521(c); H. Conf. Rep. 100-1104 at 213-14 (1988), reprinted in 1988 U.S.C.C.A.N. 5048, 5273-74.

Changing Representatives and Authority. In any case in which there has been filed a power of attorney, a new power of attorney must be filed, if, thereafter, with respect to the same matter, the taxpayer desires to:

Notices to be Given to Recognized Representative. A notice or other written communication (or copy thereof) required or permitted to be given to a taxpayer in any matter before the IRS, shall, unless restricted by the taxpayer, be given to the taxpayer’s recognized representative.

Delivery of Checks. A check drawn on the United States Treasury will be mailed to the recognized representative of a taxpayer, provided that a power of attorney is filed containing specific authorization for this to be done.