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PTIN Fees


Christian

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5 minutes ago, jklcpa said:

Right, I looked at that too. No-charge PTINs are for new applications and renewals for the 2017 season according to the IRS site. Who hasn't renewed for 2017 yet?!   

Personally I think that the PTIN should be as it was originally intended, to be as a replacement for our SSNs so that those aren't shown on the returns we prepare. I also think that regulating tax preparers without other credentials (those without JD, EA or CPA) should be handled at the state level as part of states' professional licensing and regulation.

I agree with jlkcpa . There is a caveat here and I do not think it is political as basically it is just a general government comment. The congress (house) has a bill regulating state income taxes (taxability to people working in multiple states, etc.) which would be somewhat what congress might do by having the various states require credentialing for preparers, etc.   So basically the "feds" would be telling the states how to write their tax law, etc.  --- am I old fashioned but why should the feds have that power over the states IF it is the states business, etc????

The other part of credentialing (which I do think is important for our industry) is that will it actually be for the betterment of the industry and US?  or just another way for the state government to raise money (fees, testing, etc.) for their own use.

Again, not political, just economics as I see it.

 

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IF there is going to be regulation for the preparation of FEDERAL taxes, I can understand that being an issue for a federal agency.  Currently, the JD and CPA are largely regulated and handled at the state level by state bar associations and state boards of accountancy.  The EA credential is the only one that is primarily regulated at the federal level.  And some states apparently try to prevent the use of that federal credential.

Most credentialing is for the purpose of raising money, is it not?  In a free market system, if you aren't competent, word soon gets around and your client base shrinks dramatically.  But being competent isn't sufficient if a state agency can require that you pass their competency test and pay their fees to be able to practice your trade or business. 

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25 minutes ago, jklcpa said:

Right, I looked at that too. No-charge PTINs are for new applications and renewals for the 2017 season according to the IRS site. Who hasn't renewed for 2017 yet?!   

Personally I think that the PTIN should be as it was originally intended, to be as a replacement for our SSNs so that those aren't shown on the returns we prepare. I also think that regulating tax preparers without other credentials (those without JD, EA or CPA) should be handled at the state level as part of states' professional licensing and regulation.

I totally agree.  In California we have been regulated since I started in the early 1990's.  The continued educational requirements were adjusted a few years ago so that it would meet IRS requirements, so as a result if I am qualified in California I am able to be listed as a Registered Tax Preparer for IRS's directory.  I think this is perfectly logical, however there are very few states that regulate tax preparers.  Until recently only California and Oregon.  Today there are just another handful that have any requirements that I am aware of.

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The US Congress can't make states regulate tax preparers, but several states have done so on their own.  Realize that the states often serve as laboratories for policies and procedures that, if successful, eventually enlighten national policy.  MA, for example, had mandatory health insurance requirements for years.  It worked well enough to become the prototype for "Obamacare."  Same-sex marriages were initiated by the states (which have always been the ones to make the rules governing marriages--remember the jokes about eloping to Las Vegas because they didn't have the testing and waiting periods for marriage licenses?).  There have been many attempts at the federal level to regulate tax preparers, none of which have gone anywhere.  Now it's up to the states to step in and show the feds how to do it.

I do agree that in some cases state regulation is nothing more than a money grab.  When NY first instituted regulation they charged over $100 for the privilege of filing state returns.  There were NO competency requirements at all!  They have since imposed some, but early on it was obviously an attempt to collect money.  The NY chapter of NAEA fought long and hard to get state officials to exempt EAs from the new fees on the grounds that they were already regulated at the federal level (which at least had some meaningful teeth in it).

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13 hours ago, SaraEA said:

MA, for example, had mandatory health insurance requirements for years.  It worked well enough

Ummm.... being, in MA, let's just say "no" - but it does look good from *outside* I'll give you that.  Internally it has been a disaster in many and varied ways - so yes it certainly was a prototype for the aca in that sense!

I would be much more in favor of regulation (federal or state) if it actually MEANT anything.  By which I specifically mean that they monitored the quality of the returns submitted, and clamped down hard and fast on any and every one whose returns are fraudulent or who is even just clueless.  AND if they also had a huge PR campaign to educate taxpayers on what to avoid (not to look for).  Such as "anyone who won't sign your returns - avoid"  or " anyone who claims they can get you a better refund than X - avoid" etc.  We've seen posts here (most recently from RitaB) where we KNOW who in our own areas are either incompetent or playing fast-and-loose (or both) and there's no point in reporting them because NOTHING will happen to them.  THAT is the part that has to change for ANY regulatory scheme to be anything but a money-maker for government - frequently supported by our professional societies since they all make money selling memberships and CPE classes.

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OK, Stop me if you heard this before, but I think the OPR of the IRS should regulate all Federal Tax Practitioners, including those at the IRS.  It should be an independent body that ensures the competence of the preparer, as well as the auditor.  It should have full authority to remove the privilege of practice before or for the IRS.  It should be the watchdog over both sides of the tax practice equation.

I have said this for years, but I will keep saying it until we get more competent "professionals" at the IRS.

Tom
Newark, CA

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