Accountants finally got the privilege they have always wanted in the Internal Revenue Restructuring and Reform Act of 1998. Or did they? They got a tax practitioner's privilege that applies only in civil tax matters, to accountants and others who are licensed to practice on these matters, and it is riddled with limitations. In reality, they got a compromised privilege that may serve little or no purpose.
 

Tax practitioners, like patent agents before the Office of Patents and Trademarks, have been given a limited authorization to practice law. Section 330 of Title 31 of the United States Code authorizes certified public accountants and enrolled agents and actuaries to represent taxpayers in civil matters before the Internal Revenue Service and Federal Courts.
 

Courts have given the absolute protection of the attorney-client privilege to confidential communications between clients and patent agents who are authorized to practice patent law before the Patent Office with respect to communications relating to that limited practice. See P.R. Rice, Attorney-Client Privilege in the United States § 3:19. Courts would likely have extended the full protection of the attorney-client privilege to tax practitioners had they asserted the privilege.
 

However, rather than waiting for this evolution through judicial decisions, Congress has created a specific privilege for tax practitioners in the Internal Revenue Service Restructuring and Reform Act of 1998. Section 7525 of that enactment extends the privilege to confidential communications between taxpayers and tax practitioners that are equivalent to the privilege that would protect the same "communication[s] . . . between a taxpayer and an attorney." Yet a "Limitations" sections in the provision destroys the privilege just created. It limits the application of the privilege to (1) "noncriminal tax matters before the Internal Revenue Service" and (2) "noncriminal tax proceedings in Federal court brought by or against the United States." In addition, the privilege is inapplicable to (3) "any written communications . . . of a corporation in connection with . . . any tax shelter . . . ."
 

Through these limitations the tax practitioner privilege leaves the taxpayer/client completely exposed (through the testimony of the tax practitioner) in (1) all private civil actions, (2) all criminal proceedings, and (3) even in civil tax proceedings where written communications relating to corporate tax shelters are relevant.
 

Like so many evidence rules enacted by Congress outside the Rules Enabling Act (which involves consideration by the Federal Rules of Evidence Advisory Committee and by the bench and bar through the public hearings of that Committee), the enactment of this privilege provision was unfortunate for a number of reasons. First, it is inconsistent with Congress's decision in Article V, Rule 501 of the Federal Rules of Evidence to leave the development of privilege rules to the judiciary under "the principles of the common law as they may be interpreted . . . in the light of reason and experience." As a consequence, Congress has created a rule based on neither reason nor experience.
 

Second, by legislating on specific privileges in the context of other legislative endeavors, Congress sacrificed the consistency and coherence of the evidentiary code. In the process, the privilege rule gets far too little attention from individuals with knowledge of both the privilege and the larger evidence code. If privilege rules need to be adopted, the entire privilege landscape should be addressed through comprehensive revisions to Article V of the Evidence Code. Third, legislation outside of the evidence code and the Rules Enabling Act unnecessarily politicizes the deliberation process, resulting in provisions that are unnecessary, inappropriate, inadequately debated, poorly drafted, and ultimately counterproductive.
 

The tax practitioner privilege is the product of pressure from accounting firms that have long desired an accountant/client privilege so that they can take over the tax work that is presently being performed by lawyers. That pressure, however, ultimately proved to be unsuccessful: because of considerable counter-pressure from the legal profession the "half-loaf" privilege that was negotiated is, in reality, no loaf at all. Because the tax practitioner privilege is not absolute, it will not be able to achieve the client candor that it was designed to encourage.
 

The attorney-client privilege has survived for hundreds of years because it encourages open communications between clients and their attorneys, thus enabling attorneys to give more informed, and therefore more accurate, advice and assistance. The privilege is able to accomplish this, however, only because of the absolute scope and duration of its protection. It applies to all proceedings for all times. The client knows that his words to his tax attorney can never be used to harm him. This is why the Supreme Court recently held in Swidler & Berlin v. United States, 1998 U.S. LEXIS 4214 (June 25, 1998), that the privilege protection must survive the client's death. Without similar assurances of confidentiality for communications between taxpayers and tax practitioners, the tax practitioner privilege is preordained to failure.
 

If this new statutory privilege for clients of accountants and other tax practitioners is ineffectual, it ultimately will be ignored in practice. Yet in the final analysis, the legal profession may have achieved a pyrrhic victory. Even though the privilege is not what has been advertised, its enactment will certainly prompt tax practitioners to begin asserting a privilege protection. And if logic and reason prevail, a more meaningful protection will likely be found in Evidence Rule 501 under principles of the common law and the precedence in the patent agent setting, where reason and experience has compelled the privilege's recognition in a similar context.