Question

George’s PTIN has been revoked as a disciplinary measures which of these can’t he do

Answer 1

• Under the return preparer registration requirements, individuals (including CPAs) who are tax return preparers and prepare all or substantially all of a tax return or claim for refund must obtain a preparer tax identification number (PTIN). Signing and non signing preparers are subject to the PTIN requirement.
• By 2013, PTIN holders who are not CPAs, attorneys, or enrolled agents must pass a competency examination for the type or types of returns they prepare. These persons will also be subject to a continuing education requirement. An exception to these examination and continuing education requirements is available for non signing preparers who work for CPA firms and certain other professional firms.
• Proposed changes would expand Circular 230’s coverage to all tax return preparers, not just preparers who are CPAs, attorneys, or enrolled agents. The changes will also allow registered tax return preparers limited rights to practice before the IRS.

The role of third parties in preparing tax returns has become increasingly more important. In 2007 and 2008, over 80% of all federal individual income tax returns were prepared by paid tax preparers or by taxpayers using tax preparation software. The exact number of paid preparers is unknown, but the IRS estimates that it may be as high as 1.2 million. Several oversight groups, such as the IRS National Taxpayer Advocate, 1 the General Accounting Office (GAO), 2 and the Treasury Inspector General for Tax Administration (TIGTA), 3 have identified errors and noncompliance related to the earned income tax credit and sole proprietorship tax returns prepared by national tax preparation chains and unenrolled preparers. In addition, several bills have been introduced over the years calling for tax return preparer regulation. 4

One recurring criticism of the tax return preparer industry was that anyone was permitted to prepare a federal tax return for another person for a fee, regardless of competence or adherence to ethical or professional standards. Another criticism was that tax return preparers are subject to varying degrees of oversight depending on a number of factors, such as whether the preparer is enrolled to practice before the IRS, whether the preparer is a CPA or attorney, whether the preparer chooses to file electronically, and the jurisdiction in which the preparer practices. In 2009, the IRS began to address these concerns.

IRS regulation of tax return preparers has significantly changed the rules and increased the cost of being a tax return preparer. The question is whether this cost will result in raising the competency and professional standards of unlicensed preparers. One way to measure whether IRS tax return preparer regulation is successful is to look at who is obtaining a PTIN. Unless preparers other than those who are already regulated and subject to professional and ethical standards (i.e.,CPAs, attorneys, and enrolled agents and their employees) obtain PTINs, this cumbersome and expensive process will not address the concerns that spurred tax return preparer regulation in the first place.

The IRS website has detailed information on tax return preparer regulation, including links to its online PTIN application, frequently asked questions, and information about contacting the IRS for assistance. 28 In addition, the IRS has established a Tax Professional PTIN Information Line (877-613-PTIN (7846)) and a toll line for international callers (+1 319-464-3272) that are open from 8 am to 5 pm CST Monday–Friday.