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IRS Regulation of Return IRS Regulation of Return PreparersPreparers

NTEU BriefingNTEU BriefingMarch 15, 2010March 15, 2010

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BACKGROUND

IRS Return Preparer Review

IRS Strategic Plan Objectives

Oversight agency interest

Consumer protection group concerns

Taxpayer Advocate concerns

Almost 9 out of 10 use a paid preparer/software

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Require registration, user fee, and PTIN usage for all paid signing tax preparers

Establish competency testing and continuing education for those who are not attorneys, CPAs, or enrolled agents

Conduct tax compliance checks of all registered preparers

Make all preparers subject to the ethical standards of Circular 230

Develop a public database of registered preparers

Increase our compliance/enforcement presence in the tax return preparer community

OVERVIEW OF RECOMMENDATIONS

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Phase One

September 1, 2010 – Launch registration

January 1, 2011 – Require all paid preparers to be registered with the IRS and use a PTIN

January 1, 2011 – Begin new 15 hour annual CE requirements

Phase Two

Mid-2011 – Launch competency testing, CE tracking, renewal capability, tax compliance checks, etc.

TBD – Launch public database

TARGET TIMELINE

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ALSO COMING SOON…PREPARER E-FILE MANDATE

Legislation was signed in late 2009 mandating preparers that file more than 10 individual or trust returns to e-file beginning 1/1/2011

IRS has not yet issued rules or regulations

Analysis is underway on whether the mandate will be phased in and whether there will be exceptions, waivers, or taxpayer opt-outs

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Executive Lead – David Williams Project manager – Nicole Myers Sub-teams:

IT Infrastructure – Lisa Hernandez Policy and procedures – Melissa Reynard Testing and continuing education – Larry Orozco Compliance – Barbara Fiebich Communication – Leann Ruf

IRS IMPLEMENTATION TEAM