A Message from the Office of Professional Responsibility (OPR)
I’m Karen Hawkins, the Director of the Office of Professional Responsibility, also known as “OPR”.
Given the recently proposed and historic changes planned for the tax preparation community, I’d like to spend a few minutes with you today to highlight the office and the role it will play in the oversight of paid tax return preparers beginning in 2011.
What is OPR?
The OFFICE OF PROFESSIONAL RESPONSIBILITY is charged with overseeing and maintaining consistently high standards of tax practice ethics and competence for the tax professional community.
Specifically, OPR is responsible for establishing, communicating and enforcing the standards of competency, integrity and ethical conduct of tax professionals as set forth in Treasury Department Circular 230.
What is Circular 230? Circular 230 is a set of regulations promulgated to identify who may represent taxpayers during any communications with the Internal Revenue Service regarding a taxpayer’s rights, duties, obligations, and liabilities with respect to all laws administered by the IRS.
Currently, the Circular identifies specific types of professionals who may practice before the IRS.
In all instances, these professionals are licensed by a state or federal governmental entity, and include attorneys, certified public accountants and enrolled agents.
In 2011, Circular 230’s reach, and as a consequence OPR’s jurisdiction, will expand to include paid tax return preparers.
OPR supports the IRS’ mission to provide taxpayers with top-quality service by insuring that all tax professionals adhere to identified tax practice standards, engage in ethical conduct, and follow the law.
A taxpayer’s annual contact with a tax professional often involves one of the most significant financial activities in which that taxpayer will engage- determining the correct amount of tax to pay to the US Treasury.
Insuring that the professionals who interact with the nation’s taxpayers are competent to prepare tax returns and give tax advice, and that they possess an appropriate level of integrity and ethics are all important elements of OPR’s mission.
During the past year, OPR has been refining and refocusing its procedures to enhance the transparency of its disciplinary processes and to make better use of its limited resources.
The changes being made allow OPR to focus more of its resources on behavior that causes significant harm to taxpayers or to the integrity of the tax system.
Practice before the IRS is not a right, it is a privilege: one which can be curtailed by OPR when a professional fails to adhere to the practice standards of Circular 230.
One important practice standard which seems to be misunderstood by some tax professionals is that of personal tax non-compliance: the failure of the tax practitioner to remain compliant with his/her own personal and business tax filings.
It is as unacceptable to pay without filing as it is to file without paying.
Both are indicators of the same problem: a failure to adhere to a known legal obligation.
While OPR has recently implemented some alternative disciplinary procedures to address practitioner non-compliance, this does not mean that non-compliance is acceptable conduct for a tax professional.
Personal tax obligations will remain a significant focus as the IRS proceeds to implement rules and regulations directed at its oversight of all paid tax return preparers: including requiring all paid preparers to obtain a PTIN between September 1st and December 31st.
In addition, by 2011, and for the first time, all paid tax return preparers will be subject to the regulations contained in Circular 230.
I encourage every tax return preparer, tax advisor and tax representative to familiarize him or herself with the conduct provisions of Circular 230.
For more information, just go to IRS-dot-gov and Type OPR into the search box.
During the rest of this year, I will be traveling to many parts of the US to speak to various groups of tax professionals.
I will look forward to meeting many of you at that time.
Thank you for your attention.