Get this fixed. . .

Posted by on Jun 16, 2010 in e file, Information, Opinions, Preparer regulations, Tax Preparation | 0 comments

Today I received notices from my local IRS Sr. Stakeholder Liaison. In his bulletin I found attached three documents/fliers on different things. The two that bother me are bulleted below.

  • Preparer e-File Mandate: Paid tax return preparers that prepare 100 or more individual or trust returns in 2011 will be required to e-file. That number drops to 10 for 2012. If you not already an Electronic Return Originator, start the the process.  Find out more at e-file Made Easy. You can also watch a U-Tube video. 
  • Return Preparer Regulations: IRS will soon implement new registration, testing, and continuing education requirements for all tax professionals. All {not my emphasis} paid tax return preparers must apply for a Preparer Tax Identification Number (PTIN) and register under a new system, projected to be available in September 2010. Beginning in 2011, there will be new testing and continuing education requirements for any paid tax return preparer who is not an attorney, certified public accountant, or enrolled agent. All paid preparers will come under the rules of Circular 230.

 The e-File Mandate I have already made mention of, but would like to point out one more time that this is great for the IRS but assuredly they need to come up with a plan to exclude taxpayers who do not want to e-file. Mandating 100% for us is like telling only our clients, they have to e-file. Not everyone wants to. Not to mention some software providers charge extra for us to offer this service. One scenario is the college student who is also a single mother barely making any money but yet required to file, depending on where she goes is going to be charged additional fees because now she has to e-file. {Preparer to client – “Because our firm prepares more than 100 returns we have to e-file your return and it cost $XX.xx to do this” – Fair?}

Alrighty then. . .

The second bullet, Return Preparer Regulations, this one, this one burns my hind cheeks. Now don’t get me wrong I am all for preparer regulation, yet who’s making this up? The people? By the people, for the people? Really? Examine then this situation. . . .

Now this is a great idea, but when one says all, shouldn’t that mean all? The Lawyer who has passed the bar is qualified to prepare and represent clients in tax matters. Yet Lawyers are exempt from the new testing and continuing education requirements. Because they passed the bar? What is his/her tax knowledge? Is he being tested for his competency in tax law? Not by the IRS. CPA’s, same question. What is your tax background? Are you keeping up with the preparers regulations on testing and education? You don’t have to.

As a taxpayer, who do you want doing your taxes? Someone who is being regulated and tested by the IRS, who has proven their skills as a preparer to the IRS. Or do you want someone whose specialty is divorce law and litigation, or someone who is certified at preparing and analyzing financial reports such as balance sheets, income and loss statements, or setting up an accounting system for large corps.

Now maybe I am getting this all wrong but when we say, “all return preparers” lets mean all of us. CPA’s, Lawyers, EA’s and the soon to be “enrolled” and regerstared preparers. That would be all.

So Mr. Doug, fix this. “All paid tax return preparers must apply for a Preparer Tax Identification Number (PTIN) and register under a new system. New testing and continuing education requirements for any paid tax return preparer. All paid preparers will come under the rules of Circular 230.”

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