7 Pages Posted: 11 Dec 2013 Last revised: 13 Dec 2013
Date Written: December 26, 2007
This article will analyze whether a Circular 230 Legend, a disclaimer warning that information provided in the document may not be relied on to avoid tax penalties that is placed on letters, fax cover sheets, memoranda, and other documents by law and public accounting firms and others who advise taxpayers, is necessary for legitimate tax advice, written or not. Based on the definitions set forth in 31 C.F.R. § 10.35, the article explains why Circular 230 warnings are only necessary for tax advice that makes claims of legitimacy for transactions that equate to, or approach, tax evasion. The author argues that a Circular 230 Legend is generally a waste of ink (or electrons) and indicates that the document to which it is attached contains bad advice.
Keywords: Attorney, Accountant, Income Tax, Tax Advice, Tax Fraud, Tax Evasion, Advisers
JEL Classification: K14, K23, K29, K34, K42, M41
Suggested Citation: Suggested Citation