Confidentiality privileges relating to taxpayer communications for federally authorized practitioners was created in 1998 with the enactment of the Internal Revenue Restructuring and Reform Act of 1998 (IRSRRA). In passing what became Sec. 7525, Congress believed that communications between a taxpayer and his or her advisor should be privileged in noncriminal proceedings before the IRS and in noncriminal proceedings in federal courts where the IRS is a party, provided the practitioner is authorized to practice before the IRS.
This privilege belongs to the client, and as such the client will need to assert it to prevent CPA/client communications from being introduced as evidence in covered proceedings.
Download this guide to learn about client privilege under Sec. 7525 as well as limitations and exceptions to privilege and other important considerations for tax practitioners.
Note: Although thought and effort have gone into the development of this guide, it is subject to change. You need to consider the effect that any new developments might have on this practice guide. In addition, the law itself is subject to varying interpretations. Accordingly, you retain responsibility for the final use of its content.