Circular 230 Disclaimer: Amend or Delete?

[PensionPro]

With the revised final regulations are most folks getting rid of the circular 230 disclaimer on e-mail and other communications or replacing it with a broader, more general disclaimer? Thanks!

[Bird]

I used to use this:

Circular 230 disclosure: The information in this communication is not intended to be, nor can it be, used by any taxpayer for the purpose of avoiding tax penalties.

I was going to just remove the intro "Circular 230 disclosure:" and then decided to drop the whole thing. It's silly and the IRS recognized that it's silly and there is no need for it, at all.

[Effen]

Stolen from a similar post on the COPPA Board, but I thought it was appropriate:

The IRS has made me remove the Circular 230 notice it formerly made me put here. Under penalty of law you may not rely on, and no inference may be drawn from, the fact that I have deleted the Circular 230 notice the IRS used to make me put here but has now told me not to put here. Further explanation of this notice of non-notice is available at my usual hourly rate.

Personally, I never put it on anything in the first place because I thought it was stupid. But that is just the rebel in me, I guess. It is nice to know the rest of the professional world has come around and realized it.

[Peter Gulia]

While we now look back at over-use of “Circular 230” warnings, it’s worth recalling why it happened.

1) The inconvenience, time, difficulty, and risk of analyzing why a writing isn’t a covered opinion would be disproportionate to the subject of the writing.

2) If a writing might be a covered opinion, it was practically impossible to obey the covered-opinion standards when the expected reader is not the practitioner’s client.

3) Recognizing those ideas, big law firms – and many non-professional businesses (see the next two points) – used warnings intended to meet an exception to the definition of a reliance opinion or a marketed opinion, two of the likelier kinds of covered opinion.

4) Many non-professional businesses used a warning because a lawyer employed by the business recognized that the business’ communications might include tax advice and the lawyer, as an individual, might be responsible for his or her compliance with 31 C.F.R. Part 10.

5) Many non-professional businesses used a warning because it made a communication look more “professional” or credible.

6) Although Treasury people expressed displeasure about over-cautious (and mind-numbing) “legending” of routine communications, they offered (until recently) no relief against the consequences of “guessing wrong”.

To respond to PensionPro’s query, a service provider (to the extent that it does not rely on the proper practice of a lawyer, certified public accountant, enrolled agent, enrolled actuary, or enrolled retirement plan agent) might consider (if truthful) a general warning that it does not provide accounting, tax, or legal advice.

[PensionPro]

Thanks for all the helpful responses. My query related in part to Mr. Gulia's last paragraph whether practitioners are including a disclaimer if applicable stating that the communication is not providing accounting, tax, or legal advice. Excellent food for thought!

[My 2 cents]

Personal opinion: Enrolled actuaries, in performing their duties as enrolled actuaries to a defined benefit plan, should not have been providing the Circular 230 notice to begin with. Reliance on an enrolled actuary's determination of the amount required under IRC 412 or 430 should perforce be considered entitled to treatment as good-faith reliance (so any kind of Circular 230 warning, indicating that reliance would not be able to be asserted as being in good faith, would have been entirely inappropriate). Especially if accompanied by a comment recommending that the sponsor consult with its tax advisor, determinations by the enrolled actuary of the limitations under IRC 404 should also. Circular 230 was intended to apply to potentially abusive legal positions or products, not routine funding of qualified pension plans.