## Facts

- The IRS historically regulated practice before the agency, while many paid tax return preparers (“unenrolled preparers”) operated without a comprehensive federal licensing regime.
- After courts enjoined a mandatory, broad IRS preparer-licensing program in *Loving v. I.R.S.*, the IRS adopted a narrower, voluntary initiative: the Annual Filing Season Program (AFSP), issued through Revenue Procedure 2014-42.
- Under the AFSP, unenrolled preparers who complete an 18-hour continuing-education course receive a “Record of Completion,” appear in an IRS online directory, and obtain limited rights to represent taxpayers in specified IRS matters (such as examinations of returns they prepared).
- The American Institute of Certified Public Accountants (AICPA), a professional association whose members include CPA firms employing unenrolled preparers, sued alleging the AFSP violated the Administrative Procedure Act (APA), including by bypassing notice-and-comment procedures and exceeding IRS authority.
- The district court initially dismissed for lack of Article III standing; the D.C. Circuit reversed, finding alleged competitive injury sufficient.
- On remand, the district court dismissed for lack of statutory standing (zone of interests); AICPA appealed.

## Issues

1. Whether AICPA fell within the APA “zone of interests” and therefore had statutory standing to challenge the AFSP.
2. Whether the AFSP was invalid under the APA because it required notice-and-comment rulemaking as a legislative rule.
3. Whether the AFSP exceeded the IRS’s statutory authority or improperly circumvented limitations recognized in *Loving*.

## Decision

- The D.C. Circuit held AICPA had statutory standing because its members employ unenrolled preparers and are regulated and affected by the AFSP.
- The court rejected AICPA’s APA challenges and upheld the AFSP.
- The court reversed the district court’s dismissal on statutory-standing grounds but affirmed judgment for the IRS on the merits, leaving the AFSP in effect.

## Legal Principles

- The APA “zone of interests” test is not demanding and bars suit only when a plaintiff’s interests are marginally related to, or inconsistent with, the statute’s purposes.
- A professional association may satisfy statutory standing when its members are directly affected as regulated parties by the challenged agency program.
- A voluntary agency program that conditions receipt of benefits or privileges on compliance, while leaving nonparticipants free from new legal duties or penalties, may be treated as a general statement of policy or similar non-legislative action exempt from notice-and-comment requirements.
- Following *Loving*, the IRS may not impose mandatory licensing requirements on all paid preparers under the asserted “practitioner” authority, but the IRS may set conditions for granting limited representation privileges before the agency.

## Conclusion

The D.C. Circuit concluded that AICPA could sue under the APA’s zone-of-interests standard, but it upheld the IRS’s AFSP as a voluntary, non-legislative program that permissibly offers limited benefits and representation rights without imposing mandatory licensing or triggering notice-and-comment rulemaking.


Am. Inst. of Certified Pub. Accts. v. I.R.S., 746 F. App’x 1 (D.C. Cir. 2018)