Consent to Use and Disclose Tax Information (Section 7216 Regulations Effective January 1, 2009)

Members who are engaged in tax return preparation and tax planning services need to become familiar Sec. 7216 Regulations and Revenue Procedure 2008-35, the authoritative guidance with respect to a preparer’s “disclosure” or “use” of tax return information. In general, a “disclosure” of tax return information involves a disclosure by the preparer of a client’s return information to a third party.  A “use” of tax return information generally involves the use of the return information by the preparer potentially for the purposes of offering non-tax services to the taxpayer.

The AICPA Tax Center developed a practice guide for members, which provides guidance on the new regulation as well as several examples of consent forms including:

·         Consent to disclose tax return information to be used for disclosure of the return information to (among others) your client’s banker or mortgage broker. 

·         Consent to disclose tax return information to a specific financial planning/investment firm.

·         Consent to permit a U.S. preparer to disclose tax return information (including the taxpayer’s SSN as long as adequate data protection safeguards are in place) to a foreign-based preparer.

·         Consent form covering the use of the tax return information by the preparer to disseminate firm newsletters, press releases, webcasts, and hiring announcements to individual clients.