The IRS is reportedly fine-tuning its procedures for collecting and releasing preparers’ personal information gathered during Preparer Tax Identification Number registration.

Many preparers have spoken out against the releasing of their information under the Freedom of Information Act to companies that have set up PTIN-holder directories ostensibly to help the public find tax preparers. The American Institute of CPAs has pointed out that many of the privately owned online directories are not endorsed by the IRS and that many preparers were unaware before now that their PTIN information could be released except in a long-planned IRS database. The institute has also conveyed these privacy concerns to the IRS “in numerous discussions.”

Preparers have also reported a drastic increase in spam, much of it related to continuing education, after the release of their e-mail addresses, and many object as well to having had their physical business address -- which for many preparers is also the address of their home -- released.

Some preparers admit that the release has been a confluence of increased registration requirements, quick entrepreneurial use of FOIA and an overall government atmosphere of increased transparency.

 

Responses to ‘Hot Issue’

“The IRS cannot restrict these activities since the U.S. economic system is based on free enterprise,” reads the PTIN paragraph on the service’s “Hot Issues” page.

“Questions about the private sector sites should be directed to the site contacts. Note that the IRS does not supply tax practitioners’ PTINs as part of the information released under the FOIA. The IRS is creating a publicly searchable database that will allow taxpayers to see if their tax preparer meets IRS standards or to find a tax preparer in their Zip code area. This database will have a listing of all valid PTIN holders who have professional credentials (CPAs, enrolled agents, attorneys and registered tax return preparers), and will be available approximately May 2013.”

Though it’s unclear how the IRS will -- or can -- restrict release of preparer information, the service has instituted some options for preparers to protect their privacy:

• Established a PTIN-holders’ summary of recently instituted options for preparers to safeguard their information;

* Allowed preparers to list either a physical address or a P.O. box as the “business address” when registering or renewing a PTIN;

• Allowed providing the IRS with any valid e-mail address “as long as the PTIN holder regularly checks the e-mail address for PTIN communications;”

• Changed the “Permanent Mailing Address” box on the PTIN application to “Personal Mailing Address,” clarifying that the information is personal and exempt from disclosure under FOIA rules; and,

• Provided information update pages for online and paper PTIN accounts.

Suggestions for spam:

• List a separate and otherwise unused e-mail address to receive spam.

• Report spam that does not conform to requirements listed on the Federal Trade Commission’s Bureau of Consumer Protection page, including accurate routing information, the physical address of the e-mail sender and an opt-out option that is honored promptly.