The American Institute of CPAs (AICPA) on May 11 urged key US Congressional leaders to regulate professional tax return preparers by setting specific standards and adopting other recommendations.
The recommendations follow the Biden Administration’s recent release of the American Families Plan, which includes a proposal to provide the Internal Revenue Service with authority to regulate paid tax return preparers.
In a letter to Senate Finance Committee Chair Ron Wyden (D-Ore.) and Ranking Member Mike Crapo (R-Idaho), and House Ways & Means Committee Chair Richard Neal (D-Mass.) and Ranking Member Kevin Brady (R-Texas), the AICPA recommended several proposals be included in a plan to regulate tax preparers.
Congress should reinstate the IRS’s Registered Tax Return Preparer (RTRP) program, AICPA suggested, and clarify congressional intent with respect to the RTRP program. The RTRP program should require: a one-time basic individual tax competency exam, 15 hours of annual continuing education, compliance and background checks, compliance with advertising restrictions, compliance with the ethical standards of Circular 230, and exclusions for Circular 230 legacy preparers.
Congress also should take measures to mitigate marketplace confusion. In this respect, AICPA recommended that unlicensed preparers promoting the RTRP program should inform the public that the IRS does not endorse any particular preparer and direct them to the IRS website where the differences between various types of preparers and their qualifications are explained.
AICPA also stated that Congress should limit the IRS’s authority to require a preparer tax identification number (PTIN). Certain non-signing “supervised” preparers that do not have the primary responsibility of the accuracy of the return should be excluded from the requirement. The IRS should also have authority to revoke PTINs.
Finally, the AICPA suggested that Congress should require the Government Accountability Office (the investigative arm of Congress) to study the IRS’s exchange of information with state taxing authorities in regard to preparer regulation.
“Ensuring that tax preparers are competent and ethical, and that the IRS has the tools it needs to conduct appropriate oversight, is critical to maintaining taxpayer confidence in our tax system and protecting the interests of the American taxpayer,” the AICPA said in the letter.
The AICPA is the world’s largest member association representing the CPA profession, with more than 431,000 members.
Be the first to comment