Tax Preparers Sue IRS over New Requirements

[ILLMAS]

My associate just sent this information which I would like to share with you fellow tax preparers:

http://www.accountingtoday.com/news/Tax-Preparers-Sue-IRS-Requirements-62000-1.html?ET=webcpa:e2300:#field2#a:&st=email&utm_source=editorial&utm_medium=email&utm_campaign=WebCPA_Daily_031312

[jainen]

>>Tax Preparers Sue IRS<<

I have no respect at all for this frivolous lawsuit. I am serious about being a professional in an important service industry. None of the three plaintiffs is interested in what it takes to be a full time professional. The first one doesn't even want to take yearly update classes! Another one wants the same exemptions as licensed attorneys and CPAs, but without the bother of getting licensed. The third plaintiff wants to hire others to work in impoverished areas, the taxpayers most vulnerable to being exploited by unqualified tax preparers.

[fredazcpa]

I am going to get yelled at, but in my oppion, this is good move and jainen is right, and if their was a way that you must have a PTIN to efile, and the off the self software was only good for one person that would go along way to stopping some of the fraud, and if congress would get out of the social engering with the refundable credits, or make all the refundable credits jump the hoops like they finally did with the Home buyer credit. Or maybe split the refunds up, IE if refund or the part that is from taxes withhleld goes out right away, then the rest is subject to review, which make take serveral months. Another would be to make the W2 processing the other way around, send to IRS first, so they have it one record, then start the efile in Mid Feb and move the due date back to april 30 or May 15 if needed.

[TAXMAN]

One may think that if the IRS wants to get into Real Time processing they would need this information sooner than later. I have always been for not letting anyone file untill Feb 1 and extend the due date to May 15 since some k-1's and other information we don't see untill real late. Its like trying to 50 returns in 15 days or so. I am all for extending the due date of filing but it seems like when this issue comes up it get's shot down as fast as it came up. Just my 2 cents worth.

[joanmcq]

Well, guy number one might just have to raise his prices. $75 for a biz return? Doesn't want/can't afford CPE? Change the business model to make it 'for profit' perhaps. Seems like a hobby to me.

Some of the comments on the article were pretty illuminating too. But I for one, do think that CPAs that do taxes should be required to do tax CPE, just like I'd be required to do accounting CPE if I did financial statements.

[JohnH]

I dont like the Idea of a May 15 filing date, especially since a simple step can already make the due date Oct 15.

[GeneInAlabama]

I wonder how many of the tax returns those 3 preparers prepared will be audited to prove the point that testing should be required. I sure am glad that one of them didn't prepare my return.

[GeneInAlabama]

I'm with JohnH. I encourage my clients to file extensions. I like to spread my work out over a longer period of time.

[Lion EA]

That 80-year-old can get free CPE via IRS Teleforums on his telephone, no computer needed. And, if he doesn't use tax prep software, he does NOT have to efile, so won't spend $1,000s on new equipment. He really needs to embrace change, though, to work with the constanly changing tax code to help his clients pay the least legal tax and plan for the coming year too.

[Jack from Ohio]

I wonder how many of the tax returns those 3 preparers prepared will be audited to prove the point that testing should be required. I sure am glad that one of them didn't prepare my return.

Could be a strategy by the defendents in this case.....

[BulldogTom]

I do believe the Federal Government has the right to regulate the tax prep industry. However, based on their history, I don't think the IRS or the Treasury are the agencies to do so. Why? Because you are giving the agency that we are in conflict with authority to license us. That is a real can of worms. Just like we have the Taxpayer advocate, with separate interests from the IRS, we need the OPR to move out of IRS or Treasury and become an independent arbitrator between the IRS and the tax prep community.

It scares the hell out of me that I can put so many years into building my practice, and some beaurocrat in washington can pull my PTIN and I don't have a practice anymore.

Just my 2 cents.

Tom

Lodi, CA

[J. Ron]

Being a pastor I came into this industry because of the ignorance concerning clergy tax matters about 30 years ago. It was not my intent to ever prepare tax returns, but to be able to help churches and ministers with tax issues. I learned the the law and the code in this area, and soon was being called upon to assist in correcting mistakes that had been made, often by reputable chains and accountants who did not find clergy tax issues a matter to be concerned with. ( I remember sitting in a class offered by one of the large chains where the instructor stated "Some clergy come in with a 1099, others come with a W-2 and some just have a number on a piece of paper. We don't know why there is so much difference. We just try to prepare the return with the information we have." She, knowing that i was a pastor, asked me, "Rev. H., do you understand this." I tried to explain and was given about 30 minutes of class time to help them to understand.) Since I was being called on to do so many corrections I eventually began to assist with clergy tax returns. I have never tried to make this a business, but have assisted many people through the years. I have tried to keep up with the changes and be prepared to do a quality level or work for those I serve.

That's my background. I do not mind being tested, in fact I welcome it. I do not mind the continuing education, because I need to be on top of my game. I do find a problem finding continuing education in my niche area of work. I have my CEU credits already done, but I did not feel that what I received in CEU was worth the amount it cost me. I have passed my test already. Except for a few specific Clergy Tax Seminars I never hear clergy taxes mentioned in most CEU classes. In the area in which I work I have to stay on top of the issues through much self-study for which I receive no credit. I want to be the best I can be and do the best work that I can do. So I welcome the testing. I do not welcome all the additional costs, but I know that there has to be a cost.

[Gail in Virginia]

My biggest concern is that I want to be an advocate for my clients position. I don't intentionally file an incorrect or fraudulent return. I won't ignore information that I am told. BUT I also do not want to be an unpaid auditor for the IRS. Sometimes I feel like the current due diligence requirements are leaning more and more towards making me make my clients prove their income and deductions to me.

[taxxcpa]

As a former long-time career auditor, I agree that, as a tax preparer, I should not also be expected to audit my clients. If I am representing their interests, I should be allowed to accept their word about anything other than something that I know to be untrue.

When I was an auditor, my role was adversarial in relationship to the people I audited. Even in internal audits, it worked that way.

People that I audited might disagree with me and it was their job to prove me wrong. In most cases issues could be settled without going to court. Shell Oil was an exception. About the only thing I ever got them to concede on was after my client hired a law firm and sued which resulted in an out-of-court settlement.

[mcb39]

I do believe the Federal Government has the right to regulate the tax prep industry. However, based on their history, I don't think the IRS or the Treasury are the agencies to do so. Why? Because you are giving the agency that we are in conflict with authority to license us. That is a real can of worms. Just like we have the Taxpayer advocate, with separate interests from the IRS, we need the OPR to move out of IRS or Treasury and become an independent arbitrator between the IRS and the tax prep community.

It scares the hell out of me that I can put so many years into building my practice, and some beaurocrat in washington can pull my PTIN and I don't have a practice anymore.

Just my 2 cents.

Tom

Lodi, CA

I feel pretty much the same, Tom. Have been trying to do the best job possible for well over 30 years and it could all be gone by the will of someone who doesn't even know all the answers that I do or that I am willing to look up.

[kcjenkins]

I do believe the Federal Government has the right to regulate the tax prep industry. However, based on their history, I don't think the IRS or the Treasury are the agencies to do so. Why? Because you are giving the agency that we are in conflict with authority to license us. That is a real can of worms. Just like we have the Taxpayer advocate, with separate interests from the IRS, we need the OPR to move out of IRS or Treasury and become an independent arbitrator between the IRS and the tax prep community.

It scares the hell out of me that I can put so many years into building my practice, and some beaurocrat in washington can pull my PTIN and I don't have a practice anymore.

Just my 2 cents.

Tom

Lodi, CA

Tom, you are so very, very right about this. I personally knew of one case where a preparer had exactly that happen to him. It took him two months and the aid of his Senator to get it corrected, almost put him out of business for good. And it was all over a mistake on the IRS end, too. May sound paranoid, but give one agency the power to control who can deal with that agency, and they can be as dictatorial as they want to be.