One of the lesser-known branches of the IRS is the Office of Professional Responsibility (OPR), which oversees professionals who work with taxpayers. OPR's responsibilities include ensuring tax advisors and other tax professionals follow Circular 230's standards.

Circular 230 refers to the regulations and laws that dictate:

• Who may practice before the IRS
• What that practice entails
• Practitioners' duties and responsibilities
• Sanctions for violating the regulations
• The administrative procedures for any disciplinary action

IRS employees can refer any tax advisor or other tax professional to the OPR if they believe the practitioner has violated any part of Circular 230.

Circular 230 applies to a wide range of tax professionals but does have a section specific to tax advisors, which went into effect in July 2025.

Tax Advisors and § 10.33

Circular 230 lays out the expected responsibilities and duties for tax advisors. Tax advisors are expected to provide high-quality representation and follow best practices.

These best practices include:

• Communicating with the client about the scope of the tax advisor's role in assisting the client with federal tax issues
• Establishing facts, deciding which facts are relevant, relating the applicable law to these facts, and reaching conclusions that the law and facts support.
• Informing clients about the conclusions reached and providing explanations about why an advisor recommends this course of action.
• Abiding by all other requirements in Circular 230.

When tax advisors fall short of these expectations, the OPR may pursue sanctions against them.

Tax advisors must be competent to advise clients on tax laws. They must also follow the law, base written advice on reasonable assumptions about the facts and the law, and refrain from advising the client to take a position that doesn't have a reasonable base in the law or regulations, to name just a few of the expectations listed in Circular 230.

When the OPR pursues sanctions against a tax advisor, they'll use a reasonable practitioner standard. This standard includes considering all facts and circumstances, such as the scope of the engagement and details about the advice sought by the taxpayer.

In short, the IRS can accuse a tax advisor of giving bad advice and pursue sanctions against that advisor when the IRS has evidence that the tax advisor gave incorrect advice or otherwise acted in a way that differs from how most tax advisors would act in a similar situation.

If you've worked with a tax advisor who has given you wrong or questionable advice, call Senior Partner, Tax Controversy Attorney, and former IRS attorney Brandon A. Keim at (602) 200-7399 or contact him online to discuss your options.