The American Institute of CPAshas written a letter to the Internal Revenue Service offering to help develop the IRS exam for registered tax return preparers by leveraging the AICPA's own experience with the Uniform CPA Exam.

In a letter, the AICPA recommended that the competency examination for prospective registered tax return preparers should test the basic knowledge and skills required to assist individuals in filing accurate tax returns.

"The content of the examination should be based on an analysis of the most frequently performed activities and most common errors by preparers," wrote AICPA Tax Executive Committee chair Patricia Thompson to IRS Commissioner Douglas Shulman.

The AICPA wrote that the critical steps in the test development process include defining the material to be tested, developing and pre-testing the test questions, constructing and reviewing test forms so that the final test is fair to all candidates regardless of which test form they take, reviewing candidates' comments on test questions, protecting the security of the examination, and annually reviewing the quality of the examination.

The IRS's request for comments on the planned examination is part of a broader initiative to register and regulate all paid tax return preparers. Under guidance issued by the IRS, CPAs, attorneys and enrolled agents will not be required to take the competency examination or comply with continuing education requirements set for registered tax return preparers. However, non-signing preparers at CPA firms will be subject to the test.

The letter recommended that the exam be updated annually in the fall so that it reflects the most current tax laws and regulations as the tax filing season begins, and that it be administered on a year-round basis.

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