PTIN fees to fall for 2021

Tax preparers’ annual fee to apply for or renew a Preparer Tax Identification Number next year will be $21 plus a $14.95 fee payable to a third-party contractor.

That’s down from $33, plus $17 payable to the contractor.

This amount includes costs relating to PTIN misuse and maintaining the integrity of PTINs. The contractor fee pays for a number of functions, including processing applications, renewals and operating a call center.

The PTIN user fee update is scheduled to be published in the “Federal Register” on July 17.

Among comments to the original proposal were recommendations for lower user fees for preparers with credentials and for low-volume preparers, renewal fees that were lower than initial application fees, and that the IRS adopt a longer renewal period.

The IRS estimates that more than 800,000 preparers will apply for or renew a PTIN this year. PTINs expire on Dec. 31 of the year for which they are issued. A preparer can renew online at www.irs.gov/ptin by logging into their PTIN account or by submitting a paper W-12 with the “Renewal” box checked.

Anyone who prepares or substantially helps prepare any federal return or claim for refund for compensation must have a valid PTIN from the IRS. The PTIN must be used as the identifying number on returns prepared. Failure to have and use a valid PTIN may result in penalties.