The Internal Revenue Service received and closed fewer cases against tax practitioners last fiscal year than it did in the prior year, although it managed to catch up on much of its inventory of older cases.

The OPR released its annual report Tuesday on its accomplishments during fiscal year 2016. According to the report, in FY 2016, the office received and closed fewer cases than it did in FY 2015, but it was able to increase its attention on “over-aged inventory,” defined as cases 18 months or older. The OPR reduced those cases by 40 percent in FY 2016, compared to a 4.9 percent reduction in FY 2015. On average, the number of cases per staff member was 50, while the number of intakes per staff member per month was four. The number of closures per month averaged 74. The OPR also worked with General Legal Services in the IRS Office of Chief Counsel to file two formal complaints against tax practitioners in proceedings before administrative law judges. The report noted that formal complaints are initiated only after extensive efforts are made to reach a negotiated resolution with the practitioner as they generally require a substantial investment of staff time.

IRS building sign

The OPR also imposed or obtained a total of 369 disciplinary or corrective actions during FY 2016, including one disbarment from practice before the IRS, 53 suspensions from practice, and four censures of tax practitioners. In addition, the OPR entered into six deferred disciplinary agreements, consensual arrangements between the OPR and a practitioner in which the practitioner admits to certain specific Circular 230 violations and the OPR defers discipline for a probationary period during which conditions apply to the practitioner. The OPR also issued 305 reprimands and “soft” notices against practitioners. A “soft” notice tells the recipients about apparent violations of Circular 230 but says the OPR does not intend to take any further action. A notification is a reminder that good standing as a practitioner requires adherence to Circular 230 and warns practitioners to avoid any future misconduct.

“Shortly after accepting this position in August 2015, I began having conversations with the staff to identify specific areas of focus,” wrote OPR director Stephen Whitlock in the report. “Our goals for the year were to apply the principles of due process to the investigation, analysis, enforcement, and litigation of Circular 230 cases; increase awareness and understanding of Circular 230 and the Office of Professional Responsibility (OPR) through outreach activities; and build, train, and motivate a cohesive OPR team.”

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