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What is the point of testing? If the point of testing is to weed out poor performing preparers, then the same money could be spent on a program to track improperly prepared returns. If there appears to be an issue with a particular preparer, create a process to deal with those preparers. If the purpose is to increase tax compliance, the testing would be a failure. The largest amount of noncompliance comes from those preparers who know what they are doing and choose to cheat the system. They can do this because they know where the vulnerabilities are. By going after preparers based on their filing incorrect returns you will remove more problems than testing. It will not take long before courses are made to help individuals pass the test, while providing little aid in dealing with more complicated tax areas. In reality, more of the problems come from preparers not understanding these more complicated tax areas and not from general incompetence. If you set the bar too high, it will force many preparers out of business, put a greater burden on already too busy preparers and significantly increase the cost of tax preparation for many taxpayers. If you set the bar too low, the test is useless. This is why testing will not truly increase the quality of prepared returns.
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