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For almost a decade now, Oracle and Googlehave been locked in a legal dispute over the Java API. To date, there has been a jury trial, several district court rulings, multiple appeals, one denial of cert by the Supreme Court, and one cert currently pending.

In Part I, we looked at recent cases that have eroded the scope of Circular 230 and asked whether or not this was the right result. In this part, we will look at the fundamental question that was presented in each of the three cases, should the act of preparing a tax return be considered practice before the IRS?

In the past few years, there have been several challenges to the scope of Circular 230, and consequently, the Internal Revenue Service’s ability to regulate those that practice before it. As a consequence, what was a fairly sweeping scope of authority, has been whittled away a little at a time to now a pretty limited focus.

The title of this post is a phrase that appears a lot in court cases and quoted often by administrative agencies. It almost always precedes a negative result for the taxpayer in question and conveniently ignored when a positive outcome is required.