The AICPA Needs Your Help To Get the IRS Off Tax Preparers' Backs
Pic credit: Bryan Prindiville
Here's the sitch (from the AICPA):
The IRS has proposed to register paid tax preparers by requiring:
1. A personal tax identification number (PTIN) for all preparers;
2. All preparers to be subject to Circular 230;
3. An exam for registered preparers; and
4. Continuing education for registered preparers.
CPAs, attorneys and enrolled agents would be exempt from the exam and continuing education requirements, but would be required to obtain and use a PTIN number.
The AICPA supports the IRS goal to improve the competency and ethical conduct of paid tax preparers. However, after the proposal was announced, the IRS also indicated its intent to require non-signing preparers (who are not CPAs) to register and take the proposed exam – even non-signing preparers who work at CPA firms under the supervision of a CPA.
The AICPA believes that requiring registration for non-signing preparers working at CPA firms under a CPA’s supervision is a duplicative regulatory burden on CPAs, who are already appropriately regulated by state boards of accountancy.
The AICPA also believes that the IRS is moving too quickly to implement an exam for all registered preparers, and believes that the results of PTIN tracking should be analyzed to prove whether there is a need for an exam for registered preparers.
The additional and unnecessary registration and exam requirements are a burden on American businesses, as the registration and examination costs will ultimately be passed on to consumers and businesses.
The AICPA supports the IRS goal to weed out “bad actors” through tracking personal tax identification numbers (PTIN) for all signing preparers, and encourages the IRS to fully implement the PTIN regulations before extending the requirement to non-signing preparers AND before requiring an examination.
JDA agrees that something needs to be done but requiring an exam seems a bit silly as many tax preparers are accounting students looking to provide their number-crunching services for spare cash or on a volunteer basis (like the VITA program). Many of these preparers go on to study for and pass the Regulation section of the CPA exam, which covers all federal tax issues. While the effectiveness of accounting education might be up for debate, it's true that the new requirement is more than burdensome for these folks just looking to help out that are already licensed by their state board of accountancy or supervised by an individual or firm licensed by the board..
The AICPA is asking for CPAs' help by sending the following note to email@example.com ASAP:
Subject line: IRS should slow down implementing tax preparer registration proposal
Body of email:
I urge the IRS to exempt CPA firms from the requirement to register their employees who are non-signing tax return preparers, and I urge the IRS to delay the implementation of its preparer examination.
I am a CPA and I support the goals to increase compliance and raise the ethical conduct of paid preparers embodied in your proposal to regulate paid income tax preparers. However, the costs and burdens of this proposal go too far, too fast – we need to see a reasoned, rational approach that creates benefits that outweigh the burdens on the CPA preparer community and ultimately the tax-paying public.
CPA firms stand behind the work done by the CPAs and employees of their firms. Requiring PTINs on tax returns should give the IRS enough information to track and weed out incompetent preparers, WITHOUT the need to require PTINs for non-signing preparers who work at CPA firms. CPAs are already regulated by state boards of accountancy and Treasury Department Circular 230, so I believe strongly that the PTIN requirement should not be extended to non-signing preparers at CPA firms.
I also feel strongly that the exam component should be delayed until evidence is gathered that proves the need for such an exam. The goal is to raise competency and ethical conduct; therefore, the PTIN tracking proposal should be given time to do just that, before layering on potentially unnecessary and redundant regulatory burdens on CPA firms in particular, and on all preparers and the public. In addition, I have concerns about certain aspects of the proposed Circular 230 rules that were recently released.
I request that the IRS: (1) exempt CPA firms from the non-signing preparer requirements of the proposed regulations, and (2) delay the implementation of the exam requirement until the PTIN process is fully implemented and results are known.
Thank you for your consideration of my thoughts on these important issues.
Get on it, my little mathletes!