Circ 230 proposed changes and this newsgroup MTM

What did I miss in this document that affects MTM?

Dick

The impact is that, if the proposed regulations are adopted, we can get rid of the disclaimer at the bottom of every post.

Bob Sandler

It wouldn't hurt to have a disclaimer whether Circ 230 requires it or not. In fact, I would like the wording expanded to urge caution in relying on posts to this group to make any tax or financial decision without first consulting directly with a tax professional who has ALL the relevant facts.

One of the first iterations of the disclaimer stated something to the effect that "These are the non-binding opinions of people who may or may not be tax professionals and should not be relied upon ..."

Dick

I agree. You never know when some goddammed lawyer is going to come along and try to find somebody to blame and sue on behalf of somebody who wants to blame somebody else for his own mistakes. Appropriate language helps prevent that.

I'd say something li,e "Every situation is different and based on its specific facts. Do not rely on any information you receive here. Instead talk to your own tax advisor who can give a better considered response based on all the facts of your particular situation."

___ Stu

"Stuart A. Bronstein" wrote

And sometimes we don't get all the facts when they're sitting across the desk from us.

Good point. Maybe you should have a disclaimer in your fee agreement.

___ Stu

I have never concluded that the regulations governing practice before the IRS (Circular 230) covered postings to newsgroups or tax blogs. I have always concluded that Circ 230 regulated the written opinions and advice that a tax practitioner communicated to a client. Circ 230 was never meant to infringe on a tax practitioners first amendment right to free speech. As such, I see no impact to anyone who posts to this newsgroup. I also agree with the IRS that the removal of the section on covered opinions in the proposed rules should eliminate the need for many of the disclaimers that are currently in written communication to clients.

I have never concluded anything about what Circ 230 meant. I've just chosen to play it safe.

I have also never seen any Circ 230 requirement regarding disclaimers that couldn't be replaced with the imperative, do what makes good business sense.

Finally, I have never felt that my free speech rights were impinged upon by Circ 230. I pretty much say what I feel like saying any time, any place.

My concern is over the vagueness of who exactly is a client. This comes up over and over in various IRS publications and regulations.

Here are some samples: [begin numbered list]==========

1. Consider the following language in the current version of Circ. 230:

What does it mean, "having been retained"? Someone has paid me a retainer for future tax preparation? Someone has retained me in the past, for a past tax year? Someone has signed my engagement letter but not (yet) paid me? Does this also imply that you could have a client, even though you haven't yet "been retained"?

1. Or, how about this, from T.D. 9527:

Aren't we exposed to being judged "incompetent", or of fraudulently "misleading" a "prospective client" based on posts we might make to this very public newsgroup? (no jokes, please) Remember, a prospective client does not have to post anything here, merely read it.

1. Or, continuing from TD 9527:

Since when did "a potential for tax *avoidance*" start being treated the same as tax *evasion*?

1. Continuing from above,

Say what?

1. Or, proposed § 10.37 Requirements for written advice:

Don't posts in this group occasionally "take into account" the likelihood that something will be audited?

To put this all in context, there are a number of experienced professionals who believe the long-standing "anti-stockpiling" rules (Pub 1345) mean that if a taxpayer signs Form 8879 you provided, you are mandated to e-file that return with three days, regardless of whether that person has even paid you for any service. Common sense says this person is not your client if they haven't paid you, but nowhere does the IRS rule recognize that common sense fact.

It doesn't seem reasonable that our free speech rights in forums such as this should be limited, but I would never assume that the IRS has been or will be reasonable in all situations involving free speech rights.

That is not what my common sense tells me.

That's my point. Since common sense is irrelevant to the IRS, what

Would it be considered enough information to complete a return, and therefore mandate you to e-file the return whether you had been paid or not?

(I might be hijacking a thread I started...)

this means a tax practitioner cannot practice law.

Excuse me. Common sense and taxation are unrelated.

Dick

That sounds like good old common sense to me.

___ Stu

This is from the new Circ 230?

Does this prohibit tax planning?

Rather than common sense, I suggest you look to contract law. You do have to have received a payment from someone for that someone to be your client.

The second sentence shoud read, " You do NOT have to have received a payment from someone for that someone to be a client

Yes, but there must be a mutual intent to create a client relationship.

As for Cerc 230 doing away with disclaimers, the Economically Rational Professional will continue to use disclaimers!

Q: How do you make an IRS Auditor laugh?

A: Tell'em you read on the Internet.