Circular 230 Duties, Conflicts and Written Advice
This topic covers due diligence, conflict of interest, refund check negotiation, written advice, covered opinions, tax return positions, standards for preparing returns, prompt disposition, returning client records, and restrictions on advertising, solicitation, and fees.
How to study for EA Part 3
Build every answer around practitioner authority, Circular 230 duties, taxpayer authorization, deadlines, documentation, appeal rights, e-file controls, and representation limits.
Core concepts
Concept 1
Circular 230 Duties, Conflicts and Written Advice questions test whether an enrolled agent candidate can apply representation, practice, procedure, and filing-process rules to client matters before the IRS.
Exam cue: Identify the taxpayer, representative, authorization form, IRS matter, deadline, record source, and whether the issue involves practice, representation, collection, audit, appeal, refund, or e-file.
Concept 2
The best answer usually identifies the practitioner's authority, duty, deadline, documentation, disclosure rule, conflict issue, appeal right, or sanction exposure before choosing an action.
Exam cue: Check authority, consent, confidentiality, conflict rules, due diligence, record retention, documentation, legal support, penalty relief, and appeal route.
Concept 3
Eliminate answers that exceed the representative's authority, ignore Circular 230 duties, skip authorization forms, miss statutory deadlines, or treat e-file compliance as optional.
Exam cue: Tie the result to Form 2848, Form 8821, CAF, transcript use, collection or exam procedure, appeal response, amended return, e-file requirement, or practitioner discipline rule.
Risk pitfalls and guardrails
Acting for a taxpayer without verifying the scope of authorization and whether the person may practice before the IRS.
Guardrail: Use a 15-second safety pause before finalizing your action.
Treating tax return preparation duties, written advice, advertising, fees, and client records as informal business choices instead of practice rules.
Guardrail: Use a 15-second safety pause before finalizing your action.
Missing collection, audit, appeal, refund, penalty abatement, e-file, data security, and record-retention deadlines.
Guardrail: Use a 15-second safety pause before finalizing your action.
Memory anchors
Due Diligence
Due diligence requires reasonable care in preparing, approving, and filing returns, documents, and other papers.
Conflict of Interest
A conflict can bar representation unless requirements for informed consent and reasonable belief are met.
Refund Check
A practitioner generally may not negotiate a client's refund check.
Written Advice
Written advice must consider relevant facts, reasonable assumptions, and applicable law.
Return Position
A return position must meet applicable standards and disclosure rules.
Advertising
Advertising and solicitation must avoid false, fraudulent, coercive, or misleading statements.
Fee Rule
Fee arrangements cannot be unconscionable and contingent fees are restricted in many matters.
Prompt Disposition
A practitioner must not unreasonably delay prompt disposition of matters before the IRS.
Client Records
Client records must generally be returned promptly when requested.
Covered Opinion
Covered opinion concepts reinforce careful written tax advice and avoidance of misleading reliance.
Checkpoint rule
Do the check-up only after you can summarize each concept in one sentence and identify one dangerous pitfall from memory.
Knowledge Check (after reading)
Short check-up to confirm understanding of this module.
Check-up Questions
A filing or representation issue requires the most precise EA Part 3 answer. The requirement is: Due diligence requires reasonable care in preparing, approving, and filing returns, documents, and other papers. What is the correct practice concept?
Before submitting anything to the IRS, the practitioner checks which rule applies. The requirement is: A conflict can bar representation unless requirements for informed consent and reasonable belief are met. Which rule, record, authorization, or procedure is correct?
Answer all questions to submit.
Next step personalized recommendations
Continue learning
Move forward only after this module is stable.
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