This article first appeared in the March 4, 2009 edition of Tax Notes Today.
Karen L. Hawkins, who had been slated to chair the American Bar Association Section of Taxation, instead has been chosen to direct the IRS Office of Professional Responsibility.
The appointment of Hawkins, a veteran of the tax community who has represented practitioners in sanction cases brought by OPR, was cheered by a broad spectrum of tax professionals, who in interviews with Tax Analysts remarked on her experience, intelligence, and temperament.
Hawkins will manage an office at the center of ongoing IRS efforts to develop an overall strategy for standards of ethical conduct for practitioners -- the attorneys, certified public accountants, and enrolled agents, actuaries, and appraisers who represent taxpayers before the IRS. Hawkins has at times disagreed with the course of those efforts.
The OPR has several guidance projects in the works, including new Internal Revenue Manual provisions spelling out office rules for handling disciplinary cases. Another project concerns practitioner sanction guidelines, developed with input from the Information Reporting Program Advisory Committee OPR subcommittee.
Hawkins, an adviser on the subcommittee since its formation in January 2008, at an April 30 public meeting voiced her opposition to the guidelines, calling an accompanying penalty grid system created to determine application of penalties "not workable."
Lonnie Gary, the current subcommittee chair, said the main thing practitioners want is an opportunity to defend themselves in proceedings with OPR -- a "fair shake," he said -- along with "transparency in the procedure," access to the information against them, and fair sanctions that "move us toward better compliance."
Hawkins's experience representing practitioners "gives her insight because she understands the process from the practitioners' standpoint," said Gary, an enrolled agent in Mountain View, Calif. "I think she has a unique position in that she's seen the one side and now she will see the inside."
Attorney Christopher Rizek of Caplin & Drysdale agreed that Hawkins brings a singular perspective. "She's an experienced practitioner and a leader in the tax bar, and she has a thorough understanding of both the technical rules in Circular 230 [regulations] and the practical problems that tax lawyers have to deal with every day," Rizek said. "I think she's a great choice."
Before her appointment, Hawkins was scheduled in May to become chair of the ABA's Section of Taxation. Hawkins has been a partner with Taggart & Hawkins PC, Oakland, Calif., for 25 years.
Bill Wilkins of WilmerHale and the current chair of the ABA Tax Section said in a statement that the section would "handle leadership succession without difficulty. We have a strong pipeline of future leaders, and our bylaws provide a workable system for filling vacancies," Wilkins said.
"Karen Hawkins has been a real leader within the ABA Section of Taxation, and we were looking forward to her becoming Chair," he added.
In addition to her work on the OPR subcommittee on IRPAC, Hawkins helped assemble the first statewide Tax Court bar-related pro bono programs in California. Tax community members remarked on her tireless advocacy for innocent spouse relief, representing several high-profile cases before the Tax Court and federal appellate courts, and her work on legislative changes to section 6015 relief.
"Karen Hawkins brings a wealth of experience and insight to this job," said IRS Commissioner Douglas Shulman in a statement. "She will play an important role in moving forward our overall strategy regarding tax professionals, including return preparers, and I look forward to working with her in this critical role at the IRS."
Hawkins replaces former OPR Director Michael Chesman, who stepped down in October 2008 after 20 months on the job. Chesman had high praise for Hawkins.
"She is a thoughtful, highly intelligent, and experienced attorney with enormous insight into the rules under Circular 230 and how OPR should enforce those rules," Chesman said. "The leadership of OPR could not be in better hands, and I congratulate Commissioner Shulman on such an outstanding choice."
Ronald Wiener of WolfBlock and former chair of the American College of Tax Counsel's Professionalism Committee said the tax community is fortunate she accepted the role.
"I can't imagine a better qualified person in the U.S. to head OPR -- qualified by knowledge and temperament and judgment," Wiener said. "In my opinion, all of us in the tax system, on both sides, are lucky she was willing to take the job. Let's all wish her smooth sailing."