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Proposed bill to regulate tax preparers has AICPA support


By Dave Strausfeld, J.D.

The AICPA signaled strong support for a bill introduced in Congress last week that would authorize Treasury to regulate paid tax return preparers and mandate minimum competency standards. The proposed legislation has bipartisan backing and is sponsored by Reps. Jimmy Panetta, D-Calif., and Tom Rice, R-S.C.

If enacted, the Taxpayer Protection and Preparer Proficiency Act, H.R. 4184, would, among other things, authorize Treasury to reinstitute the IRS’s 2011 Registered Tax Return Preparer program.

“The AICPA is pleased to endorse this bill, and we appreciate Representatives Panetta and Rice for working together to introduce this important legislation,” Edward Karl, CPA, CGMA, AICPA vice president–Taxation, said in a press statement. “Ensuring that tax preparers are competent and ethical, and that the IRS has the tools it needs to conduct appropriate oversight, is critical to maintaining taxpayer confidence in our tax system and protecting the interests of the American taxpayer.” The proposed bill also has been endorsed by other external stakeholder organizations.

The bill’s introduction in Congress last week follows on the heels of the Biden administration’s request in late April, in its American Families Plan, for bipartisan legislation to authorize the IRS to regulate paid tax preparers who are currently unregulated. The AICPA welcomed the administration’s proposal in a May 11 letter to congressional tax leaders that was signed by AICPA President and CEO Barry Melancon and Tax Executive Committee Chair Christopher Hesse.

More specifically, H.R. 4184 introduced last week by Panetta and Rice would:

  • Give Treasury authority to regulate paid tax return preparers;
  • Clarify that the authority being provided is to reinstitute the IRS’s 2011 Registered Tax Return Preparer program;
  • Give the IRS authority to revoke an incompetent or fraudulent preparer’s preparer tax identification number (PTIN);
  • Clarify that certain nonsigning preparers — those persons who are employed by and prepare returns under the supervision of an attorney, CPA, or enrolled agent — are not required to obtain a PTIN; and
  • Require a U.S. Government Accountability Office study on the sharing of information between Treasury and state authorities regarding PTINs issued to paid return preparers and preparer minimum standards.

The AICPA has long been an advocate of appropriate regulation of paid tax return preparers, the organization noted in its press statement.

Dave Strausfeld, J.D., (David.Strausfeld@aicpa-cima.com) is a Tax Adviser senior editor.



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