The IRS has released (effective 6/12/14) the final Cir 230 Regulations dealing with written advice provided by tax practitioners. As part of the final regulations the IRS has listened to industry comments and modified the “covered opinion rules” thus eliminating the need for those annoying e-mail disclaimers.
IRS observed that many practitioners currently use a Circular 230 disclaimer at the conclusion of every e-mail or other writing to remove the communication from the covered opinion rules in former Reg. Sec. 10.35. These types of disclaimers are routinely inserted in any written transmission, including writings that do not contain any tax advice. The removal of former Reg. Sec. 10.35 eliminates the detailed provisions concerning covered opinions and disclosures in written opinions. Because amended Reg. § 10.37 does not include the disclosure provisions in the current covered opinion rules, IRS expects that the new final regs will eliminate the use of a Circular 230 disclaimer in e-mail and other writings.
Final Reg. § 10.37 replaces the covered opinion rules with principles to which all practitioners must adhere when rendering written advice. Specifically, Reg. § 10.37 states affirmatively the standards to which a practitioner must adhere when providing written advice on a Federal tax matter. Reg. § 10.37 requires, among other things, that the practitioner;
- Base all written advice on reasonable factual and legal assumptions,
- Exercise reasonable reliance,
- Consider all relevant facts that the practitioner knows or reasonably should know, and
- Ascertain the facts relevant to written advice on a Federal tax matter. (Reg. § 10.37((a)(2))