A Guide to Ethical Practices in the United States Tax Industry
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About this ebook
Terrence E. Simon Ph.D.
Terrence Simon, Ph.D. is a management consultant. His experience spans a broad spectrum of disciplines where he held key management positions. He spent a decade in the United States tax industry honing valuable skills and experience in tax practice. He graduated from Capella University with a Ph.D. in Organization and Management. A resident of Brooklyn, New York, Dr. Simon is actively involved in community development.
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A Guide to Ethical Practices in the United States Tax Industry - Terrence E. Simon Ph.D.
A Guide to
Ethical Practices
in the
United States Tax Industry
Terrence E. Simon, Ph.D.
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© Copyright 2013 Terrence E. Simon, Ph.D.
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the written prior permission of the author.
Cover Illustrated by: Marcus R. Embry
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Edited by: Sharlin Espinal
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ISBN: 978-1-4907-1696-1 (sc)
ISBN: 978-1-4907-1697-8 (e)
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TABLE OF CONTENTS
Preface
Introduction
An Overview Of The Us Tax Industry
Part 1 Promoting An Ethical Culture In Tax Preparation
Ethical Hurdles
Discourse Ethics—Communicating With Clients
Virtue Ethics—Does Character Really Matter?
Care Ethics—Treat Clients As Patients
Part II The Ideologies Of Tax Practitioners
How Beliefs Can Shape Practice
Embrace Idealist
Be Watchful Of Relativist
Avoid Realist
Will Practitioners Change Their Ideologies?
Part III The Pitfalls Of Tax Practice
Challenges To Ethical Standards
The Audit Lottery
Part IV Preventing Malpractice
Training And Education
The Competent Tax Practioner
Epilogue
References
DEDICATION
To all clients who entrusted the preparation of their tax returns to practitioners whose actions resulted in harm, audits, payments of penalties and interest, and a bad tax preparation experience.
ACKNOWLEDGMENTS
The completion of the book was not only by long demanding hours of work on my part, but by the support of my wife, children, family members, and friends. Thank you very much from the bottom of my heart for the invaluable support and advice given to me throughout the writing of the book.
PREFACE
I t is a commonly known fact among the tax practitioner community that ethical dilemmas are faced every day and affect interactions with clients. This state of affairs means that tax practitioners are used to navigating murky ethical waters in service to their work. If the issue of ethics was not complex enough, tax practitioners differ in culture, standards, and philosophy. Delving into these ethical dilemmas and cultural differences became a personal endeavor to me over the course of my scholarship on the topic.
Some may argue that current ethics and professional standards amongst the community are appropriate. But due to the great variance in education and training in the tax practitioner community this is not always the case.
In the United States, the tax practitioner can subscribe himself to several different ideologies. Each camp argues its merits and proposes a view of tax preparation that navigates the inconsistencies that many face. Idealists, Relativists, and Realists expound the virtues of their positions. But is one approach more correct?
The conflicting approaches to addressing ethical behavior is rooted in the customs and culture of the tax practitioner and his individual values, work background, age, and personality. Some scholars feel that organizational factors including management philosophy, job dimensions, competition, and economic conditions also influence the ethical behavior of tax practitioners.
Training is also often overlooked and much maligned by the community. In my research on this topic my endeavors resulted in Reducing income tax preparation errors: An exploratory study of tax practitioners perceptions of training and Its Impact on income tax preparation, a dissertation published in 2012. What I found is that many practitioners felt the issue was still a grave concern and garnered little to no attention in the community and among the governing bodies. Returning to training, I found that one of the most important factors in reducing the number and severity of unintentional errors is the level and effectiveness of that individual training. The