What is the Taxpayer Protection and Preparer Proficiency Act?


        In June, legislation was introduced into Congress known as the Taxpayer Protection and Preparer Proficiency Act. The goal of this bill is to create a minimum Federal standard for all tax preparers. At this point, none exists. However, there are basic standards that must be met under laws in certain states, like in California. There are tens of thousands of complaints received by the Internal Revenue Service (IRS) every year that relate to poor service from tax preparers. Fraud can be prosecuted, but nothing can legally be done in the case of incompetence. This new tax law is taking aim at this problem.

          This law is an effort to make sure that every taxpayer can be assured that their tax preparer is qualified. The requirements would include showing an ability tax returns and claims for refunds, it would also require continuing education credits. The IRS would also be given the authority to invalidate taxpayer identification numbers (PTINs) of any preparer who no longer met these qualifications. Since paying taxes on income is the obligation of everyone who earns a wage in the US, doesn’t it make sense to have some basic assurance that every paid preparer is qualified? For more about this topic, please look at our series of posts on the subject of Qualified Tax Professionals.

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