NCCPAP endorses tax preparer regulation

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The National Conference of CPA Practitioners has endorsed legislation to give the Treasury and the Internal Revenue Service the authority to regulate tax preparers.

In a letter to Sens. Chuck Grassley, R-Iowa, and Ron Wyden, D-Oregon, and Reps. Kevin Brady, R-Texas, and Richard Neal, D-Massachusetts, the organization urged them to pass S.1192/H.R.3330, “The Taxpayer Protection and Preparer Proficiency Act,” or incorporate its provisions in some other bill.

“This legislation could not be timelier,” NCCPAP president Neil Fishman and Tax Policy Committee co-chairs Stephen Mankowski and Sanford Zinman write in their letter. “Currently, anyone can start a business claiming that they prepare income tax returns for individuals and businesses. All that is required is for that individual to obtain a Preparer Tax Identification Number from the IRS; however, no one checks their level of competency.”

“With all that has occurred with regard to the COVID-19 pandemic, we feel that individuals and businesses who engage a tax return preparer need to have confidence that those they engage are both competent and current,” the NCCPAP letter continues. “In addition, federal and state governments, which rely on tax revenues to operate and provide services, should support this legislation so that no one is claiming any deductions for which they are not eligible. Unfortunately, there will always be fraudulent tax returns prepared and submitted.”

The IRS had introduced a regime to regulate tax preparers with a competency exam and required professional education back in 2010, but the program was successfully challenged in court in a ruling that eventually held that the IRS would require explicit permission from Congress to initiate preparer regulation.

The bill, which would give the IRS the necessary authority and was sponsored by Rep. Ted Yoho, R-Florida, and Wyden, has languished in committee in both the House and the Senate since April of 2019.

Earlier in the week, NCCPAP sent a letter to the same legislators, asking for Congress to grant smaller loans from the Paycheck Protection Program automatic forgiveness, and to allow businesses to deduct expenses paid for with forgiven loans. (See our story.)

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Tax preparers Tax preparation PTIN NCCPAP IRS Chuck Grassley Ron Wyden