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Voluntary Preparer Certification

On Tuesday, June 24, 2014, the AICPA (American Institute of Certified Public Accountants) sent a 14 page letter to IRS Commissioner John Koskinen expressing its strong concerns that a proposed IRS voluntary certification program for unenrolled tax preparers “would cause significant legal problems that may ultimately frustrate the IRS’s goals, confuse the public and lead to litigation”.  Some of the “legal and policy concerns” raised by the AICPA included:

  1. no statute authorizes such a program;
  2. The program will be viewed as a way to circumvent the federal court’s Loving decision;
  3. The way the program has been developed does not comply with the notice and comment requirements of the Administrative Procedure Act, violates the Paperwork Reduction Act by collecting personal information from tax return preparers, and ignores a Cost/Benefit Analysis required by the Office of Information and Regulatory Affairs; and
  4. The proposed program is “arbitrary and capricious because it fails to adddress the problems presented by unethical tax return preparers who defraud their clients, runs counter to evidence presented to the IRS and will cause market confusion.”

The AICPA must have known something was coming down the pike because on Thursday, June 26, 2014, the IRS announced that it would soon introduce a voluntary program for tax return preparers called the Annual Filing Season Program.  The program will require a preparer to complete 18 hours of continuing education, including a six hour refresher course for tax season, 10 hours of federal tax law topics and 2 hours of ethics.  Upon completion, the preparer would be listed in a directory on the IRS website along with other “recognized” preparers such as CPA’s, attorneys and the like.

Bottom line, since the IRS had to terminate its preparer certification program requiring successful passage of an examination and 15 hours of continuing education annually due to its loss in federal court in the Loving case, and Congress’ inability to get anything done this year on the regulatory side due to the President’s continuing antics, in my opinion, this Annual Filing Season Program is better than nothing, and, in my opinion, the AICPA’s concerns are pure legal largesse, which really surprises me coming from such an institution.  Factually, this Annual Filing Season Program doesn’t do much of anything in terms of reigning in the inefficient preparers out there, as the Registered Return Preparers Progam (RTRP) would have begun, but at least this step forward would give dedicated prparers, like myself, the opportunity to get some public recognition from the IRS and help concerned tax payers find somewhat more qualified prepares, if they choose to look.

I fervently support the IRS certifying tax return preparers with an examination and a requirement of continuing education annually, but since the courts put a stop to that and the Congress can’t seem to get anything done regarding it, at least this Annual Filing Season Program is a step in the right direction.