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Right to Practice 

ISSUE:  In recent years, there has been an increase of proposed rules and advisory opinions promulgated by state bar associations and branches of state government regarding unauthorized practice of law restrictions that impact CPAs.

BACKGROUND:  It is widely recognized that an overlap of the accounting and legal professions exists.  The areas of tax practice, estate planning and pension planning are so interrelated that it is difficult to distinguish professional jurisdictions. For more than forty years the American Bar Association (ABA) and the AICPA have worked together through the National Conference of Lawyers and Certified Public Accountants to promote understanding between the professions and their clients. 

The subject of unauthorized practice of law occasionally emerges in the states. Although in some cases CPAs are not the specific targets of these actions, the proposed rules are often drafted so broadly that they would seriously impact the normal practice of CPAs.

WHY IT’S IMPORTANT TO CPAs:  
As activity by state bar associations increases in the area of unauthorized practice of law, it threatens the ability of CPAs to practice in traditional and customary areas of public accounting.

AICPA POSITION:  
Through the State Regulation and Legislation Team, the General Counsel, and the Taxation Team, the AICPA has worked, and continues to work with, state CPA societies in each of the jurisdictions that require assistance. 

State societies are urged to monitor this issue and to determine if the bar associations in their respective states are considering any new proposals dealing with the unauthorized practice of law.

STATE ACTION:  
South Carolina (1991) – A major decision was rendered when a redefinition of practice of law in the form of proposed rules by the South Carolina Bar Association, to include all tax work except the actual preparation of tax returns, was proposed. The South Carolina Association of CPAs, the AICPA and the larger firms filed a brief before the Supreme Court of South Carolina, on behalf of the profession.  In September of 1992, the South Carolina Supreme Court issued an Order rejecting the proposed rules submitted by the state bar association.  In its order, the court recognized the "unique status" of CPAs and acknowledged respect for the training and procedures under which CPAs operate.  The court rejected the proposed rules as "neither practicable or wise" and instead will decide the unauthorized practice of law on a case-by-case basis.

Other action by state bar associations and branches of state government have included the following significant proposed rules and advisory opinions:

Tennessee (1993) - A favorable decision by the Supreme Court of Tennessee was issued in late 1995.  The decision resulted from a petition from the state's Attorney General requesting a determination of whether representation of taxpayers by registered appraisers and other non-attorneys before the state and local boards of equalization constitute the practice of law.  The Tennessee Society of CPAs, the AICPA and the larger firms filed a brief before the Supreme Court on behalf of the profession.

New Hampshire (1994) - A State Supreme Court decision, which narrowly defined the practice of law before state agencies, has the potential to impact CPAs representing taxpayers before the New Hampshire Board of Tax and Land Appeals. Comments on whether non-lawyer agents who represent taxpayers before this Board are engaged in the unauthorized practice of law were submitted on behalf of the profession by the New Hampshire Society of CPAs, the AICPA and the larger firms.

District of Columbia (1995 - 1997) - Proposed rules on the unauthorized practice of law were drafted by a D.C. Bar Association committee.  Because of the broad definition that was being proposed, it was possible that if this definition were approved, traditional accounting services could be affected.  The Greater Washington Society of CPAs and the AICPA forwarded comments on the impact of these proposals to the appropriate Bar Committee in 1995.  A comment letter on the proposed rules was transmitted to the D.C. Court of Appeals in February 1997.

Alaska (April 1996) - Proposed rules on the unauthorized practice of law are pending before the Alaska Supreme Court.  As currently drafted, the rules may impact traditional services provided by CPAs.  A comment letter asking the Court to clarify the rules was submitted on behalf of the Alaska Society of CPAs.

In the past few years, several states had active issues.   Some of these actions included legislative attempts to redefine the unauthorized practice of law or efforts to adopt state Supreme Court rules on the unauthorized practice of law.  The AICPA has worked with the state CPA societies to resolve these issues. 

AICPA STAFF CONTACTS:  
Virgil Webb, General Counsel and Trial Board, 202/434-9222

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Continuing Professional Education (CPE) for Certified Public Accountants (CPAs)

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North Carolina State Resources and Contact Information

Link:  North Carolina state resources in the areas of accountancy, government, study, and taxes.
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District of Columbia Resources and Contact Information

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Link:  Virgin Islands resources in the areas of accountancy, government, study, and taxes.
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New Hampshire State Resources and Contact Information

Link:  New Hampshire state resources in the areas of accountancy, government, study, and taxes.
Published on April 23, 2013

State Regulation and Legislation Team Contact

Directory:  Find contact information for AICPA staff in on the State Regulatory and Legislative Affairs team.
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State Regulatory and Legislative Affairs Team Contact Sheet

Directory:  State Regulatory and Legislative Affairs Team Contact Sheet
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State Regulatory Webcast - June 2011

Conference Materials:  Powerpoint presentation from June 2011 State board Webinar on peer review, codification update and IRS Tax preparer.
Published on April 02, 2013

Illinois State Resources and Contact Information

Link:  Illinois state resources in the areas of accountancy, government, study, and taxes.
Published on March 27, 2013

Texas State Resources and Contact Information

Link:  Texas state resources in the areas of accountancy, government, study, and taxes.
Published on March 19, 2013

Washington State Resources and Contact Information

Link:  Washington state resources in the areas of accountancy, government, study, and taxes.
Published on March 06, 2013

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