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What is a tax advisor?
The Internal Revenue Services defines a “tax preparer” as “a person who, for compensation, prepares all or substantially all of a federal tax return or refund application.
What are the recent changes to becoming an IRS-registered tax return preparer (RTRP)?
The IRS requires all paid tax preparers to register with the IRS, pay a registration fee, and obtain a tax identification number (PTIN) for the preparer. If you already have a PTIN, you still need to register for the new process. All paid creators must register and obtain a PTIN before the tests become available (mid-fall 2011) or they will not be able to create returns for compensation.
As of October 2011, tax preparers must pass an IRS competency exam to officially become an IRS-registered tax refunder. Individuals who have PTINs before the test becomes available have until December 31, 2013 to pass the IRS proficiency test and can take the test an unlimited number of times to pass. There is a fee for taking the test, and that fee is due each time each attempt to pass the test is due. After tests are available, new tax preparers must pass the IRS competency test before they can receive a PTIN. The IRS requires competency tests for all paid tax preparers (except attorneys, CPAs, registered agents). The IRS will phase out the following three tests: Year 1 – Wage and non-business, Year 2 – Wage and small business, Year 3 – Business tax rules. All preparers who register before the start of the proficiency test (October 2011) have three years until December 31, 2013 to pass a proficiency test.
What are the fees to get a PTIN?
The IRS has an online registration system, paid tax preparers pay a usage fee of $64.25 for a PTIN for the first year.
What is the difference between a registered agent and an IRS-registered tax return preparer?
The practice of the IRS-registered tax return preparer is limited to preparing tax returns for indemnification and representing taxpayers in the audit when the return being examined was a return prepared by them, while the practice of the registered representatives before the IRS is not limited.
How do I become an IRS-registered tax return preparer?
To become a tax accountant in California and Oregon, you must follow state guidelines as well as Internal Revenue guidelines. The state of California requires all paid tax preparers to complete a 60-hour California Registered Tax Preparer Qualification Course and register with the California Tax Educational Council (CTEC). In addition to state requirements, the Internal Revenue Service requires an annual IRS competency review. This is expected to start in October 2011. Once an individual holds a valid PTIN and passes an IRS competency test, they become an IRS-registered tax return preparer.
How do I keep my registration up to date?
The IRS requires all paid tax preparers (excluding attorneys, CPAs, enrolled agents) to complete 15 hours of CPD per year to continue your tax preparer training. The IRS will require that the 15 hours include three hours of federal tax law updates, two hours of tax preparer ethics, and 10 hours of federal tax law topics. Although there are no Continuing Professional Education (CPE) requirements for 2011. The IRS’s continuing professional development (CPE) requirements begin in 2012. Individuals who are registered tax preparers and those who have provisional PTINs but by December 31, 2013 to pass the test must be in calendar year 2012 and in 15 hours of continuing education courses from IRS-approved providers each subsequent year.
How are there other requirements?
Yes, the IRS may fingerprint some applicants in the future. All applicants are currently required to include a statement of any criminal convictions in the past 10 years when applying for a PTIN.
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