new requirements for tax preparers

[morrisliberty]

hello,

The IRS is trying to regulate the tax professional industry with the new guidelines and future rules for tax preparers. For many tax preparers such as CPAs, enrolled agents,and lawyers they seem to be exempt from many of the new rules since they are covered by other certifying organizations but are the new "certified tax preparers" who are not CPAs, enrolled agents, and lawyers are they going to be held to the same high standards with less training and education? If I am employee of a national tax preparation firm , what are the responsibilities of the firm and what are my responsibilities under these new and future guidelines? If I am being paid $15 an hour and a CPA is being paid $200 an hour can the IRS or client expect the same level of expertise in preparing a tax return? The main reason many clients choose a tax preparer is price and I have noticed in the past few years more clients are preparing their own tax returns and call the office with a question about the tax software, The IRS is planning on testing thousands of preparers what is the goal? Is the test a minimum knowledge requirement, intermediate or advanced knowledge? Is it open book? Is the goal of the test to eliminate tax preparers who are honest and have a basic or intermediate understanding of the tax laws? It would be easy for the IRS to devise a test that would eliminate 90% of current tax preparers by the complexity and content of questions asked and scoring of test. Is this fair?

[dancinmama]

IF they'd change the d$@# tax code so that there were not so many stupid rules, deductions, loopholes, etc. we wouldn't need to test tax preparers. I'm sorry, I know it would effect your livelihood and I know that is a factor, but this has gotten completely out of control.

[bookcrazychick]

Not real sure what point you are trying to make but I am very glad to see this new requirement. I have been in public accounting for 23 years and am tired of seeing honest people being cheated by preparers who don't know what they are doing and dishonest people being aided by preparers who don't know what they are doing.

Dancinmama, totally agree. We're lucky in that tax prep is a very small portion of our business. We are busy all year and then just have even MORE work to do from Jan-April 15. If I had my way the only tax returns we would prepare would be for clients whose accounting we do all year and not bother with clients with ONLY a return. But DH doesn't see it my way

[mwcpa]

the purpose of the "new" rules, which have been known about for over a year and a half, are to weed out some of the illegitimate preparers out there.... while it will not eliminate the preparers that refuse to sign their client filings and mark them as "self prepared" it should give the public confidence that when a paid preparer has a PTin and signs a return that there is some level of minimal knowledge... CPAs, EAs, attorneys have some form of formal education, continuing education requirements and all took a very difficult exam (for their chosen field).... while not all CPAs, EAs and attorneys are good tax professionals, at least the public has a recourse against those who do a bad job (state boards of accountancy regulate CPAs, the IRS regulates EAs, state bars regulate attorneys and the IRS has oversight on them all through circular 230), for non enrolled preparers, while I sure there are many qualified individuals out there, it is the wild west.... these "new" rules will address some of this....

[morrisliberty]

hello
thank you and I agree with your replies, what I am trying to say the new "certified tax preparers" or non enrolled preparers or whatever name you call this new group are they going to fall under circular 230 ? If not then are we creating a new group of licensed preparers who are not under circular 230 and a group of preparers who must follow circular 230?

[bookcrazychick]

mwcpa, how do you think this will affect tax shacks? I was very surprised to recently learn that you can own an H & R Block franchise with NO accounting/tax background. Our local H & R Block, who is also my client, is owned by a woman with no tax experience. She is not a CPA, EA, etc. I just found that very surprising.

[mwcpa]

morris.... I believe that once a preparer enrolls in the new program the IRS does have oversight...

chick.... I do not think this will impact the big box chains that much....

[commentator]

I believe the store front chains have to have the returns signed by a covered tax preparer - that is, one who has, at least, passed the IRS exam.

[rangerj]

Note: ALL paid persons who contribute to a tax return, the preparer, appraiser (if applicable), actuary, etc, are covered in Circular 230 and are subject to the scrutiny of the Treasury Department. As for the complexity of the tax law, it has evolved with business and business practices, and social practices to a degree, and to some degree has been used, by Congress, to accomplish some social engineering. We are in a global economy and it is complex. I have said all along that the Treasury Department and Congress need to set strict standards for tax professionals and require more education and testing for those who are not CPAs or attorneys. The Enrolled Agent program is a good starting point and that should be the minimum standard.

[Small Biz Owner]

I am sure my tax preparer is already certified. I think?

He says he is ........

[bookcrazychick]

May 6, 2011 6:58:33 GMT -5 @commentator said:

I believe the store front chains have to have the returns signed by a covered tax preparer - that is, one who has, at least, passed the IRS exam.

Not our local branch. All the employee's have taken the H & R Block course but I know for a fact none of the preparers they used this year have any other "certification".

[mwcpa]

small biz.... to deal with the tax law I know I have to be "certified".... or is that "certifiable".... hahahahaha

[rangerj]

Ditto MW, that is the certifiable part. I dealt with publicly held corporations most of my career and now in retirement I have a few small business clients, and periodic assignments, or referrals, from my prior employer. The small businesses are by far much more of a challenge. The publicly held work was only federal tax law. The small business work is federal, state, and local tax, as well as workmen's comp, unemployment, and any and all other state, local, and/or Federal involvement , e.g. the state Liqueur Control Board (restaurant). What a PIA. Given the fact that any and all of this impacts the tax return there is no way anyone with a mere 10 weeks of Publication 17 training should be allowed to prepare any tax returns other than a simple 1040 EZs, period. Because of the complexity there should be various levels of licenses for tax professionals just like there is in the medical profession.