preparers who receive a PTIN will come into
effect in 2011.
The IRS anticipates that the number of individuals who will request P TINs will swell to
1. 2 million after the rules go into effect.
Sign-ups for P TINs began in mid-Septem-
ber. Among the questions that applicants
are asked are whether they owe money to
the IRS, and whether they have been con-
victed of any felony. A “yes” answer to either
question is not a deal-breaker, according to
Williams, who noted that the form will also
have a space where applicants can explain
the circumstances. “In some states, you can
be convicted of a felony if your dog takes a
poop on the sidewalk,” he said. “But if you
were convicted of armed robbery last year,
we want to know about it.”
“We don’t want to take away your liveli-
hood,” Williams emphasized. The testing
period, which begins next June, will include
Forms 1040, Schedule C-EZ, and perhaps a
small business return. “We’re not trying to
weed people out,” he said. “Our goal is a mini-
mum level of competency.”
Registration
From page 1
TESTING AND CPE
Tests will be given at multiple locations
around the country and will be conducted
online. However, tax preparers will not be
permitted to bring a laptop with tax software
to the testing location.
“We want people to be able to explain why
someone didn’t qualify for an EI TC or is sub-
ject to the Alternative Minimum Tax,” said
Williams. “You can’t say it’s because the tax
software said so.”
Tax preparers will need to be able to ex-
plain their answers and demonstrate at least
a minimal level of competency. If they flunk
the test, they will have multiple opportuni-
ties to retake it. Once they obtain their PTIN,
they will have until the end of 2013 to pass the
exam. After testing begins, new PTIN appli-
cants who are not attorneys, CPAs or enrolled
agents will be required to pass the compe-
tency test prior to obtaining a P TIN.
The required continuing education will include three hours of federal tax law updates,
two hours of ethics, and 10 hours of federal
tax law. Currently, about 500 providers have
been approved to provide the continuing
Baac Office, was among NetSuite’s first certified consultants in Canada, and played an
integral role in shaping the new program. He
had suggested the free accountant’s login,
and said that he had spoken with the vendor
NetSuite
“They’re going in steps,” explained Jeffery
Trinca, vice president of Washington-based
government affairs firm Van Scoyoc Associ-
ates. “Those who get a P TIN for the upcoming
filing season will get transition relief. They
will have two or three years to take the exam,
but folks who get their P TINs after testing be-
gins will have to otherwise qualify. I would
recommend a firm get PTINs for everyone
in the shop while we sort out who eventu-
ally behind the scenes will have to register
and take the exam. If someone in your office
helps or participates in preparing a return, at
least in the beginning it will be a good thing
to have a P TIN.”
Individuals who have a valid PTIN when
testing is available in mid-2011 will have until
Dec. 31, 2013, to pass the test.
Under the proposed regulations, compensated preparers would pay a $64.25 user fee
the first year for a PTIN. The figure includes a
$50 fee for outreach, technology, and compliance efforts associated with the new program,
and a $14.25 fee paid to a third-party vendor
to operate the online system and provide customer support.
AICPA TAKES ISSUE
Hearings on the proposed regs have generated a number of comments from professional organizations, with the biggest concerns
voiced by the American Institute of CPAs.
“We have issues with the inclusion of non-
signing preparers,” said AICPA vice president
for taxation Ed Karl, who testified at the hear-
ings. “It doesn’t make sense from a CPA firm’s
perspective. For many firms, the only practi-
cal way to ensure compliance with the new
regulations will be to register all non-FATP
[federally authorized tax preparer] staff who
contribute to the preparation of tax returns
in a way that is not purely administrative or
characterized as simple data entry.”
Karl estimated that the AICPA has 39,000
member firms with five or fewer CPAs, and of
these, about 29,000 are sole practitioners. As-
suming that each firm has five non-CPA em-
ployees performing non-signing work related
to the preparation of tax returns, including
interns, full-time, part-time or seasonal help,
he estimated that for the first year of a regula-
tory regime each firm would incur $10,000
for PTIN registration, testing and education.
“Most of these costs stem from requiring
over the years about establishing an accountant program. Baac Office has been a NetSuite
consultant for 10 years.
ADVERTISER
INDEX
