42-2069. Taxpayer communications with practitioners; confidentiality; definitions

A. With respect to tax advice, the same common law protections of confidentiality that apply to a communication between a taxpayer and an attorney also apply to a communication between a taxpayer and a federally authorized tax practitioner to the extent that the communication would be considered to be a privileged communication if it were between a taxpayer and an attorney.

B. Subsection A of this section may only be asserted in:

1. A noncriminal tax matter before the department.

2. A proceeding before the state board of tax appeals.

3. A noncriminal tax proceeding in court.

C. The department may deny an individual coverage under this privilege if it determines that a practitioner has engaged in activities or practices involving matters before the department that, if they involved matters before the United States internal revenue service, would result in the practitioner losing the authorization to practice before the internal revenue service. A practitioner aggrieved by a determination to deny the privilege may appeal that determination pursuant to section 42-1253 or 42-1254.

D. For the purposes of this section:

1. "Federally authorized tax practitioner" means an individual who is authorized under federal law to practice before the United States internal revenue service if the practice is subject to federal regulation under 31 United States Code section 330. Federally authorized tax practitioner includes any person who is engaged in practice with one or more federally authorized tax practitioners and who is subject to the same standards of practice and ethics requirements as a federally authorized tax practitioner.

2. "Tax advice" means advice given by an individual with respect to a matter that is within the scope of the individual's authority to practice as a federally authorized tax practitioner.