The American Institute of CPAs told the Internal Revenue Service that it should avoid requiring pre-approval of continuing education courses as part of its tax preparer regulation efforts.

Patricia Thompson

“We believe that by not mandating a course-by-course pre-approval process, the IRS will ensure that continuing education courses are timely and that the ultimate system for monitoring course quality will allow the IRS to effectively manage its limited resources,” AICPA Tax Executive Committee chair Patricia Thompson wrote in a letter to the IRS.

The letter, which was submitted to the IRS, praised the IRS for dropping an earlier proposal that would have required continuing education providers to obtain pre-approval from the IRS before they could offer continuing education courses to the public.

CPAs for the most part will not be affected by the IRS’s continuing education requirements, as they are already subject to continuing professional education requirements as a condition of maintaining their CPA licenses with state boards of accountancy. The AICPA itself is one of the leading providers of CPE courses for CPAs at its regular conferences. But non-signing preparers at CPA firms who are not themselves CPAs will be subject to the IRS’s new continuing education, testing and registration requirements.

The IRS asked for comments about continuing education providers as part of the program it is implementing to regulate paid tax return preparers following the release of its 2009 report on the paid tax return preparer community.  The IRS report was triggered by compliance studies issued by the Government Accountability Office and Treasury Inspector General for Tax Administration that implicated the “unenrolled” preparer community as a major source of compliance problems.

Tax preparers who are not CPAs, attorneys or enrolled agents are known as “unenrolled” preparers. Minimum continuing education requirements will be mandatory for registered tax return preparers. In general, CPAs, attorneys and enrolled agents have their own continuing education requirements under Circular 230.

Thompson noted that continuing education providers that are now accredited by the National Association of State Boards of Accountancy to provide continuing professional education courses for CPAs, attorneys and enrolled agents should continue to automatically qualify as approved continuing education providers for registered tax return preparers. The AICPA and state CPA societies are NASBA-registered CPE providers.

In addition, the AICPA recommended that the IRS establish a database on continuing education providers that could be accessed through the IRS.gov site. As soon as a continuing education provider is approved by the IRS, or loses its IRS approval, that information would be available to the public.