TAX PREPARERS SHOULD BE QUALIFIED TO PREPARE TAX RETURNS
I am appalled that the IRS cannot enforce certain professional standards on all tax preparers who prepare tax returns. The tax laws are extremely complex and sophisticated. In my opinion, not just anyone should be given the right to prepare someone else's tax return. The preparer needs to have sufficient competence and expertise to know what they are doing. Otherwise, what is the point?
During the tax season, many little tax businesses open up for the sole purpose of preparing tax returns. They advertise, attract hundreds of customers through incentives such as quick refunds, refund anticipation loans, and low fees. They use tax preparation software which gives the illusion of professionalism and hand over to their customer, a tax return which may or may not be correct. Then, they shut down and are unavailable for off season contact.
The IRS has attempted to regulate tax preparers in an effort to protect the public. However,
on Friday, Jan. 18, 2013, the United States District Court for the District of Columbia enjoined the Internal Revenue Service from enforcing the regulatory requirements for registered tax return preparers. In accordance with this order, tax return preparers covered by this program are not required to complete competency testing or secure continuing education. The ruling does not affect the regulatory practice requirements for CPAs, attorneys, enrolled agents, enrolled retirement plan agents or enrolled actuaries.
Fortunately, on Friday, Feb. 1, 2013, the court modified its order to clarify that the order does not affect the requirement for all paid tax return preparers to obtain a preparer tax identification number (PTIN). Consistent with this modification, the IRS has reopened the online PTIN system.
The IRS has stated that they remain confident in their legal authority and committed to protecting taxpayers through implementing reasonable standards in the tax preparation area. Their appeal of the district court opinion was filed on Mar. 29, 2013.
Are people protected against incompetent tax preparers? I don't think so.