Long-Awaited Circular 230 Changes Take Effect in June

With the recent high profile cases on tax shelters and stepped up enforcement by the IRS on a range of fronts, tax professionals must take careful steps to stay within the rules. To help with creation of best practices for tax advisory practices, the IRS has changed the rules under Circular 230 effective in June. These new rules outline the category of “covered opinions” that will affect the advice tax practitioners can give under certain circumstances. But many tax professionals will be unaffected by these rules, notes Harvey Coustan in a recent issue of the Journal of Tax Practice & Procedure. Coustan outlines what is a covered opinion, what steps are necessary for tax practitioners who are issuing such opinions and he also outlines the new requirements for issuing written tax advice that does not fall under covered opinions. Note that the new regulations even specify how the typefaces of disclosures have to be bolder and larger than the rest of the type in written advice. There are penalties attached to these new regulations for firms that do not put adequate procedures in place to ensure compliance, so it’s critical to take a close look now at what your practice is doing and what needs to be done in the future to ensure compliance.

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This story is from the CCH’s monthly Focus on Tax newsletter, which provides advise and guidance on federal and state tax issues for tax and accounting professionals.

Read this article from CCH’s Journal of Taxation of Financial Products.

AUTHOR

Wolters Kluwer Tax and Accounting

Wolters Kluwer Tax and Accounting is a leading provider of software solutions and local expertise that helps tax, accounting, and audit professionals research and navigate complex regulations, comply with legislation, manage their businesses and advise clients with speed, accuracy and efficiency. Wolters Kluwer Tax and Accounting is part of Wolters Kluwer N.V. (AEX: WKL), a global leader in information services and solutions for professionals in the health, tax and accounting, risk and compliance, finance and legal sectors. We help our customers make critical decisions every day by providing expert solutions that combine deep domain knowledge with specialized technology and services. Wolters Kluwer reported 2016 annual revenues of €4.3 billion. The company, headquartered in Alphen aan den Rijn, the Netherlands, serves customers in over 180 countries, maintains operations in over 40 countries and employs 19,000 people worldwide. Wolters Kluwer shares are listed on Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices. Wolters Kluwer has a sponsored Level 1 American Depositary Receipt program. The ADRs are traded on the over-the-counter market in the U.S. (WTKWY).

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