Washington, D.C. - The Internal Revenue Service has issued proposed regulations requiring paid tax preparers to furnish an identification number on tax returns and claims for tax refunds that they prepare. The proposed regs provide guidance on how the IRS will define the identifying number. Additional provisions provide that tax return preparers must apply for and regularly renew their preparer identifying number.

The regulations propose that for tax returns or refund claims filed after Dec. 31, 2010, the identifying number that a preparer must include with the preparer's signature on tax returns and refund claims is the number prescribed by the IRS in forms, instructions or other guidance.

Preparers will not be able to use a Social Security number unless specifically prescribed by the IRS in forms, instructions or other guidance. Instead, a preparer would be required to use a PTIN as the identifying number unless the IRS prescribes a replacement for the PTIN in the future. (For more on the regs, see our cover story.)



Washington, D.C. - The Internal Revenue Service continues to have problems with the security of its computer systems, jeopardizing the confidentiality of taxpayer information, according to a new report by the Government Accountability Office, which acknowledged that the IRS made progress last year in addressing 28 of the 89 information security weaknesses that the GAO found in 2008. However, 69 percent of the weaknesses and program deficiencies remain unresolved.

For example, the IRS continued to install patches in an untimely manner and used passwords that were not complex. In addition, the IRS did not always verify that remedial actions had been implemented or that they effectively mitigated the security weaknesses.

The GAO recommended that the IRS take a series of some 27 actions to help fully implement its agency-wide information security program.

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