WASHINGTON –– The Internal Revenue Service kicked off the 2010 tax filing season today by issuing the results of a landmark six-month study that proposes new registration, testing and continuing education of tax return preparers. With more than 80 percent of American households using a tax preparer or tax software to help them prepare and file their taxes, higher standards for the tax preparer community will significantly enhance protections and service for taxpayers, increase confidence in the tax system and result in greater compliance with tax laws over the long term.

To bring immediate help to taxpayers this filing season, the IRS also announced a sweeping new effort to reach tax return preparers with enforcement and education.

As part of the outreach effort, the IRS is providing tips to taxpayers to ensure they are working with a reputable tax return preparer.

"As tax season begins, most Americans will turn to tax return preparers to help with one of their biggest financial transactions of the year. The decisions announced today represent a monumental shift in the way the IRS will oversee tax preparers," said IRS Commissioner Doug Shulman.  "Our proposals will help ensure taxpayers receive competent, ethical service from qualified professionals and strengthen the integrity of the nation's tax system. In addition, we are taking immediate action to step up oversight of tax preparers this filing season.”

Based on the results of the Return Preparer Review released today, the IRS recommends a number of steps that it plans to implement for future filing seasons, including:

• Requiring all paid tax return preparers who must sign a federal tax return to register with the IRS and obtain a preparer tax identification number (PTIN). These preparers will be subject to a limited tax compliance check to ensure they have filed federal personal, employment and business tax returns and that the tax due on those returns has been paid.

• Requiring competency tests for all paid tax return preparers except attorneys, certified public accountants (CPAs) and enrolled agents who are active and in good standing with their respective licensing agencies.

• Requiring ongoing continuing professional education for all paid tax return preparers.

UPDATE:

National Society of Accountants Statement on Proposed

IRS Tax Preparer Regulations

The National Society of Accountants (NSA) has issued the following statement in response to the Internal Revenue Service proposed regulations regarding registration, testing, and continuing education for tax return preparers:



"The National Society of Accountants (NSA) is strongly in favor of these proposed new IRS regulations, because we see a lot of problems in the marketplace," says NSA President Robert L. Cross, ABA, ATA. "NSA members, who are experienced tax professionals, are often called on to fix the mistakes that unqualified tax preparers make. In fact, NSA asked IRS to address this issue several years ago and this is good news for taxpayers and qualified tax professionals everywhere."