Practice sale disclosure

Definition

Federal rules let a client list move with a practice sale and keep most of the rest behind written consent.

Why It Matters

The federal floor has its own sale clause: a preparer may hand over a list of client names, contact details, entity types and return form numbers with the business, and diligence on that list runs under a written confidentiality agreement. Most of the rest of a tax file needs the client's written consent. California forbids disclosing confidential client information without the client's written permission, then carves out one path for a sale, which is a written nondisclosure agreement between the two firms covering everything shared. Washington's board allows the same review and attaches no condition of its own, though the federal confidentiality agreement still governs the list, so the gate is a state question before it is a deal question. Sign the nondisclosure agreement before a single file moves, keep a record of what was shared, and read the state's own rule instead of assuming diligence works the way it does in an unregulated trade.