The National Society of Accountants has submitted comments to the Internal Revenue Service about plans for a tax preparer competency examination, supporting the intended purpose of verifying the “minimal competency” of tax preparers.
“We need to ensure that all paid and volunteer tax preparers have the basic ability to prepare tax returns, and that’s what the IRS always intended this exam to do,” says NSA executive vice president John Ams. “It should not be confused with, or be equivalent to, the Enrolled Agent examination, the CPA examination, or other examinations that clearly test for knowledge that is beyond minimal competency.”
The NSA also noted in its comments that it believes the level of expertise expected by the IRS when approving Volunteer Income Tax Assistance volunteers is one of at least minimal competence.
“We are comfortable with this expectation and believe the same standard should be used for determining minimal competence by paid preparers,” NSA said in its comment letter. ”Accordingly, the examination should be no more difficult than the examination given by the IRS to select VITA volunteers.”
NSA added that the areas of tax law that should be covered by the examination should include only those covered in Publication 17, the basic areas covered in Publication 334, and the ethics, penalty and education provisions of Circular 230.
The NSA also believes that exam results should be reported to applicants with a pass/fail indicator when completed. However, both those who pass and those who do not should be provided with a document showing the number of correct/incorrect responses by area of tax law.
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