New AICPA Tax Standards Go Into Effect Jan. 1
In August 2022, the American Institute of CPAs (AICPA) released proposed revisions to the Statements on Standards for Tax Services (SSTSs) for public comment. The AICPA’s Tax Executive Committee (TEC) reviewed and adopted the updates to the SSTSs on May 18, 2023; the updated standards will be effective on January 1, 2024.
The AICPA SSTSs serve as the ethical framework for tax professionals and are enforceable tax standards for AICPA members. The standards were updated to keep pace with the evolving tax profession. The goals of the revisions to the SSTSs were to ensure that the standards are better aligned to reflect the current state of the tax profession and to address the emerging needs of today’s members.
The revised tax standards include:
Additionally, the existing Interpretations and FAQs have been updated to reflect the reorganization of the revised tax standards with updated citations.
At the time of the drafting of the original standards, most of the tax services being provided were compliance-oriented and involved tax return preparation. The revision project reorganized the SSTSs so that most of the existing standards have been incorporated into either general standards (SSTS No. 1) or compliance standards (SSTS No. 2). Because the new SSTSs around data protection and reliance on tools are applicable to different types of tax services, they were also included with the general standards. The existing standard related to tax advisory services (SSTS No. 3) and the new standard related to representation services (SSTS No. 4) were determined to be unique and have been separately stated.
This alignment is intended to assist members in applying standards to specific tax practice situations and to help them understand the scope and expectations of these standards.