On February 11, 2014, the D.C. Court of Appeals ruled that the IRS had no legal authority, and cannot assume such authority, to impose a nationwide licensing scheme on tax preparers that would expand the authoritative power of the IRS over the tax-preparation industry, and quite possibly increase costs to millions of taxpayers in fees for tax return preparation.
Currently, tax preparers are required to obtain a PTIN or Preparer Tax Identification Number, but there is no requirement for continuing education or ongoing exams that CPAs and tax attorneys are required to maintain and pass. Having basic standards and a strong quality control system will help prevent tax preparation fraud and protect the taxpayers against less than honest preparers.
IRS Commissioner John Koskinen mentioned that he would be open to the possibility of offering the certification on a voluntary basis if the IRS loses the appeal. At this time, the IRS remains non-committal on whether or not they will decide to seek an appeal in the Supreme Court.
Ultimately, it is the taxpayer who is solely responsible for the accuracy of their tax return, so it is smart to ask a potential tax preparer about their qualifications, especially with regard to professional organization status and continuing education classes. Tax Code changes daily and it is important to make sure your tax preparer is up-to-date with the latest Codes.
The IRS recommends checking with the Better Business Bureau for the history of your tax preparer company, and for any disciplinary actions and current licensing status. In addition, you can check state board of accountancy for CPAs (Certified Public Accountants), State Bar Associations for tax attorneys, and the IRS Office of Enrollment for Enrolled Agents.
Ask about service fees and IRS e-file costs. Any paid tax preparer who files more than 10 returns generally must file them electronically. Stay clear of anyone who bases their fees on the percentage of your refund; or those who claim they can get you larger refunds than others. Also make sure that the refund will be deposited into your account, or that the check will be mailed to you, and not to your tax preparer.
A good tax preparer will ask for your records and receipts, as well as asking you questions to determine your income, credits and deductions and any other items. Beware of those who claim they can file your taxes by using your latest pay stub; this is against IRS e-filing rules.
Review your return before signing – and never sign a blank tax return. Make sure your tax preparer signs the appropriate sections and includes their PTIN, as both are required by law. You should also receive a copy of your tax return from your preparer. If you suspect a tax fraud or an abusive tax preparer, report them to the IRS – you can use Form 14157, Complaint Tax Preparer, or if you suspect that the information on the return was modified without your consent, Form 14157-A, Return Preparer Fraud or Misconduct Affidavit.
At US Tax Shield, the nation’s leading tax relief company, we take great pride in offering unparalleled customer service and commitment to our clients. That is why we have been awarded an A+ rating with the Better Business Bureau as well as outstanding reviews from previous clients; you can read them here and here. Click here to learn more about our experienced tax attorneys and enrolled agents,
If you need help filing your back taxes, or if you are tired of negotiating with the IRS on your own, call US Tax Shield today at 877-829-3535.