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IRS logoAlthough the Internal Revenue Service will require competency testing for paid tax return preparers who are not CPAs, Enrolled Agents or Tax Attorneys, those who register for an identification number before tests are available would have three years before they must undergo the examinations. Those remarks were made this week by David R. Williams, the Internal Revenue Service executive lead for implementation for the program, at the board of directors meeting of the National Society of Accountants.

With the service readying an online registration system for a September launch, the IRS also says it is developing two levels of competency tests that it expects to be available by April. There will be one test for wage and non-business 1040 returns and a second for wage and small business 1040 returns, Williams told the group. An 1120 form test is also being planned, although no availability date has been established.

He also outlined plans under which a Preparer Tax Identification Number, valid for three years, must be used on all federal returns prepared after December 31 or on claims signed by preparers. However, those who get PTINs before tests are available will have three years before being required to take them. Once testing is available, unregistered, unenrolled preparers would have to pass tests before obtaining a PTIN. To prevent TPIN certificates from being duplicated, the IRS also plans to create a public database of registered tax preparers

PTIN applicants will be subject to tax compliance checks to ensure preparers have filed their own tax returns and paid, or made arrangements with the IRS for payment of federal tax debts.

There will not be a public awareness campaign regarding PTINs until after an education campaign for preparers starts in the middle of next year. After that, Williams said outreach to the public would begin.

Those subject to the tests must complete 15 hours of continuing education each  year, including three hours of federal tax law updates, two hours of ethics and 10 hours of federal tax law. Williams said that would require revamping the current CE sponsor approval program. The IRS wants to make sure education providers offer "a minimum level of value," he commented.

Last modified on Sunday, 02 June 2013
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