Conflicts of Interest
Learn the decision pattern the exam can test, then apply it to a realistic taxpayer fact pattern.
What changes the answer?
Client consent does not cure every conflict, especially when representation is prohibited by law or materially impaired.
A tax-practice scenario
An EA represents spouses with diverging positions in an examination. Identify the conflict before sharing strategy or confidential facts.
Identify the taxpayer, entity, transaction, and tax period first. Write the controlling tests in order, apply only the relevant facts, and keep the reporting result separate from any planning recommendation.
Do not take this shortcut.
Seeking consent only after advocacy has already harmed one client.
Turn the rule into recall.
Run a conflict check at intake and again when facts, parties, or positions change.
- ExplainState the governing distinction without notes.
- ApplyChange one fact in the scenario and predict the new result.
- RetrieveAnswer an unseen question, then review every option.
Official source and scope
This lesson follows the current PSI content outline and uses the IRS reference below for the underlying tax or practice framework. Always confirm current forms, instructions, thresholds, and effective dates before advising a taxpayer.