Monday, January 04, 2010

New Tax Preparer Regs Proposed by IRS

The Internal Revenue Service announced new regulations for tax preparers in a 55 page report today. Key items: paid tax preparers are required to obtain a preparer tax number; all preparers except attorneys, CPAs and EAs are required to take competency exams (the IRS indicated that it reserves the right to require exams of the first three categories in the future); all tax preparers (not just attorneys, CPAs and EAs) must take continuing education and ethical rules of Treasury Circular 230 will apply to all paid tax preparers, not just attorneys, CPAs and EAs.

In my view, the primary, perhaps only, legitimate complaint about these regulations would be a libertarian (federal government should not be meddling) one. Some may complain that attorneys. CPAs and EAs were cut a break on testing--two comments here: (1) to some degree, the bar, CPA and especially EA exams DO test competency on taxation, (2) there is little doubt that the IRS will remove the exemption if attorneys, CPAs and EAs fail to perform competently on tax returns going forward.


Blogger Carol Topp, CPA said...

I have mixed feelings about these new regs. As a CPA I am already under many regs by my licensing board. That's why CPAs were exempt from these new IRS regs. BTW, CPAs also have ethics requirements, not required by the new regs. CPAs liked that we were differentiated from other tax preparers. Now we fear a loss of that differentiation. JMHO.

2:17 PM  

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