By Norma Wahnon
Copyright 2012 Norma Wahnon
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Treasury Department Circular 230 (Rev. 8–2011) ” Regulations Governing Practice before the Internal Revenue Service” sets forth stringent standards of practice and disciplinary sanctions for violations of those standards. The new scope introduced by the 2011 IRS and Treasury Department amendment to Circular 230 extended the applicability of the standards and sanctions in this circular to registered tax return preparers. Therefore, 15% of the questions in the competency examination necessary to become a registered tax return preparer are on these topics.
Circular 230’s complete text is in a short 48 page booklet (PDF file) you can find in the IRS website. For your preparation for the IRS competency examination, you will be tested on just the content of sub–parts A, B, and C, which are included in the exam outline as testable topics.
In the introduction to Circular 230, the legal source of authority to set rules for practice before the IRS and Treasury Department it is stated that the Secretary of the Treasury may:
– “regulate the practice of representatives of persons before the Department of the Treasury; and
– Before admitting a representative to practice, require that the representative demonstrate: a) good character; b) good reputation; c) necessary qualifications to enable the representative to provide to persons valuable service; and d) competency to advise and assist persons in presenting their cases.”