Enrolled Agents (EAs) play a vital role in the U.S. tax system, acting as advocates for taxpayers and providing professional tax advice. To ensure that EAs uphold integrity and public confidence, they are governed by a set of ethical standards laid out in IRS Circular 230. This document, issued by the Treasury Department, provides guidelines for practicing before the IRS, encompassing attorneys, CPAs, enrolled agents, and other tax practitioners. Circular 230's primary objective is to regulate the behavior of those offering tax-related services to maintain a voluntary and compliant tax system.

Circular 230 encourages tax professionals to adhere to best practices, particularly in preparing or assisting in the preparation of tax returns and submissions to the IRS. Key practices include clearly communicating the scope of advice, establishing relevant facts, and thoroughly evaluating assumptions. This ensures that tax positions are supported by the law and facts, giving taxpayers confidence that their returns are accurate. Advisors are also responsible for informing clients of penalties and helping them avoid risks through proper disclosure when necessary.​

EAs must abide by several duties and restrictions when practicing before the IRS. This includes maintaining diligence regarding the accuracy of tax documents, avoiding unreasonable delays in matters before the IRS, and ensuring that no assistance is provided by individuals disbarred from practice. Circular 230 also emphasizes the importance of EAs exercising competence in their duties, requiring adequate knowledge, skill, and preparation for each case they handle. Failing to adhere to these standards can lead to disciplinary actions such as censure or disbarment.

One of the key ethical responsibilities for an EA under Circular 230 is addressing client noncompliance. If an EA discovers that a client has failed to comply with tax laws, or has made errors in their filings, the EA is obligated to promptly notify the client and advise on the legal consequences. EAs must also be cautious when relying on information provided by clients; if discrepancies are found, they are required to make reasonable inquiries to ensure accuracy. Ignoring such discrepancies can lead to penalties for both the client and the practitioner.

EAs must avoid conflicts of interest that could compromise their ability to represent clients effectively. If such a conflict arises, they must obtain written consent from all affected parties before continuing their representation. Additionally, Circular 230 imposes strict guidelines on fees. Practitioners cannot charge unconscionable fees, nor can they accept contingent fees unless in specific circumstances like an IRS challenge or judicial proceeding. Violations related to conflicts of interest or unethical fee practices can result in severe penalties.