• Sexton Opinion Further Restricts What Conduct Can Be Regulated Under "Practice" Before the IRS
  • July 3, 2017 | Author: Arianna Caldwell
  • Law Firm: Caplin & Drysdale, Chartered - Washington Office
  • On March 17, 2017, the U.S. District Court for the District of Nevada issued its decision in Sexton,<sup>1</sup> becoming the first court outside of the District of Columbia to adopt the D.C. Circuit’s holding in Loving.<sup>2</sup> As discussed further below, Loving (and the later Ridgeley<sup>3</sup> case) held that the IRS does not have the authority to regulate mere tax return preparation. While the acceptance of Loving outside the District of Columbia is not surprising, Sexton potentially extends the reach of Loving outside of the tax return preparation context and calls into question the regulation of advice rendered by tax professionals. Specifically, Sexton may curtail the ability of the IRS Office of Professional Responsibility (OPR) to regulate tax professionals, lead to limitations on regulatory oversight depending on the service being performed by the professional, and thereby present hazards for tax professionals and taxpayers.