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The case of the tax practice review

Ethics

Charles Selcer, CPA, MBA | August 2018 Footnote

The firm of Franks & Beanz (F&B) saw its tax practice expand and become more varied. It decided it was time to have something similar to a peer review of its tax practice -- a voluntary tax practice review (VTPR). The managing partner, Albeef Franks, wondered whether he needed permission from the firm's clients when their previously completed and filed tax returns are reviewed.

Q.  Do they need permission from their clients to have the files reviewed?  

A. An exposure draft issued June 20, 2018, discusses a possible answer. The exposure draft posits that compliance with Treasury Reg 301.7216(p) should suffice. However, the Reg covers VTPRs when only certain classes of reviewers are used; these people falling under the purview of the IRS include CPAs, enrolled agents, lawyers and enrolled actuaries. (Read the exposure draft and Treasury Reg 7216.)