ExpertCPA · Question 02 · Area I: Ethics & Tax Procedures
A practitioner is representing a taxpayer in an IRS examination. The taxpayer has a 25% ownership interest in a partnership that is also being audited. The practitioner determines that representing both the taxpayer and the partnership would create a conflict of interest. Under Circular 230, the practitioner may continue to represent both parties only if:
A practitioner is representing a taxpayer in an IRS examination. The taxpayer has a 25% ownership interest in a partnership that is also being audited. The practitioner determines that representing both the taxpayer and the partnership would create a conflict of interest. Under Circular 230, the practitioner may continue to represent both parties only if:
Answer options:
The practitioner notifies the IRS of the conflict in writing.
The representation is not prohibited by law and the practitioner obtains verbal consent from each client.
The practitioner reasonably believes they can provide competent and diligent representation to each client, and each client waives the conflict in writing.
The conflict does not involve a criminal investigation.
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