IRS Updates

Update from the IRS Return Preparer Office

“As of Friday, January 18, 2013, the United States District Court for the District of Columbia has 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 currently required to register with the IRS, 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.

The Internal Revenue Service, working with the Department of Justice, continues to have confidence in the scope of its authority to administer this program. It is considering how best to address the court’s order and will take further action shortly. In the meantime, please remember to check our webpage at www.irs.gov/taxpros. As additional information becomes available, it will be posted there.“

Update January 23:  The IRS will appeal the Court’s ruling.  A motion to “Suspend Injunction Pending Appeal” was filed on Thursday, January 23, 2013 on behalf of the IRS with the US District Court in Washington, DC.

The IRS is working diligently to resolve issues surrounding the issuance of Preparer Tax Identification Numbers (PTINs) for the filing season. Additional information will be provided shortly as to how to obtain PTINs.

Update January 30: On Tuesday, January 28, the Plaintiffs filed opposition to IRS Motion to Suspend Injunction Pending Appeal. The IRS has 2 days to respond to this opposition.

Update February 1: On Friday, Feb. 1, 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 court wrote today, “[S]ome preparers may wish to take the exam or continuing education even if not required to.  Such voluntarily obtained credentials might distinguish them from other preparers.”

The IRS continues to have confidence in the scope of its authority to administer this program and is working with the Department of Justice to address all options, including a planned appeal.

To participate in a discussion on this development, you may apply for membership in the LinkedIn Group, Tax Business Owners of America.