AICPA Provides IRS Proposed FAQs, Seeks Additional Section 7216 Guidance

May 7, 2009

Mr. David R. Williams

Director, Electronic Tax Administration and Refundable Credits

Internal Revenue Service

1111 Constitution Avenue, N.W.

Room 7331 IR

Washington, D.C.   20224




Dear Mr. Williams:




We want to thank you for hosting the recent meeting with the undersigned professional associations regarding regulations under Internal Revenue Code section 7216, the disclosure or use of information by tax return preparers. At the meeting, you asked us to draft a series of frequently asked questions (FAQs) addressing issues of concern to taxpayers and tax return preparers relating to Treas. Reg. sections 301.7216-1, 301.7216-2, and 301.7216-3.




In response to your request, we have attached eight FAQs which we consider an important starting point for discussions with the Service on additional needed guidance. Please be assured that our efforts focus on ensuring the regulations achieve a balance between: (1) strengthening a taxpayer’s abilities to make informed and voluntary decisions regarding a preparer’s disclosure or use of tax return information; and (2) respecting the traditional office practices and procedures of ethical, competent tax return preparers.




At the end of the FAQ document, we have also included a list of modifications which we believe are critical to making the section 7216 regulations more workable. For example, one of our recommendations is that tax return preparers should be allowed to cover a broad range of professional services as part of a written consent included in an engagement letter, as opposed to requiring preparers to obtain separate written consents from clients.




We would also appreciate any assistance the Office of Electronic Tax Administration and the Wage & Investment Division can provide us to ensure that a recommendation is placed on the Treasury/IRS Priority Guidance plan for additional guidance under the section 7216 regulations. Thank you for your help on what is a very important matter to the nation’s taxpayers and tax professional community.








American Institute of Certified Public Accountants

National Association of Tax Professionals

National Society of Accountants

Padgett Business Services

Download FAQ Document