The IRS is requiring all paid preparers to register with the IRS, obtain a PTIN and for those preparers who are not CPAs, attorneys, or enrolled agents to pass a competency exam and maintain continuing education. Here is what we know to date;
PTIN Requirements
- All paid preparers will be required to register and obtain a PTIN before they can prepare returns for compensation. This applies whether you sign the return or not.
- A PTIN must be renewed annually and will expire on December 31 of each year. The renewal period begins in October of each year.
- Tax preparers must pay a $64.25 user fee to register and obtain a PTIN. To renew a PTIN, there is a $63 user fee.
Testing Requirements
- Certain preparers who do not sign the tax return and who are supervised by a CPA, EA or an attorney who owns at least 80% of the firm, are exempt from the competency and continuing education requirements. Notice 2011-6 has additional details.
- All preparers who have a provisional PTIN before April 18, 2012, will have until December 31, 2013, to pass the competency exam. NOTE: This date may be extended.
- Once this date passes, preparers will not be issued a PTIN until they have passed the competency exam and background check.
- Testing is expected to begin in November 2011.
- There will be one exam that will test Form 1040. The IRS will not provide sample questions. Click here to access the areas the IRS has indicated it will cover in the exam.
- You will not be allowed to bring your own reference materials into the testing location. Prometric will make available Publication 17 and Form 1040 and instructions for attendees.
- You must log into your online PTIN account on irs.gov to schedule an appointment to take the competency exam. View a tutorial on How to Register for the RTRP Exam.
Continuing Education Requirements
- Tax preparers who are not EAs, CPAs or attorneys must take 15 hours of continuing education beginning in 2012. The annual continuing education requirement must include 3 hours of federal tax law updates, 2 hours of ethics, and 10 hours of other federal tax topics.
- Individuals who are Registered Tax Return Preparers, and those who have provisional PTINs but have until December 31, 2013 to pass the test, will need to obtain 15 hours of continuing education during calendar year 2012 and each subsequent year.
- If you become initially registered after January 31, you must take one hour of continuing education for each month or part of a month you are registered. You must take 2 hours of ethics regardless of when you become registered.
Tax preparers may not use the title registered tax return preparer until they have met all the conditions of becoming a registered tax return preparer, including passing the competency exam and background checks.
NATP developed a review course for candidates to help them pass the exam. This course is available beginning in May 2011 at select locations. Click here for course objectives, locations and registration form.
Registered Tax Return Preparer Exam - Candidate Information Bulletin
What We KNOW and What We DON'T KNOW about the competency exam
Registered Tax Return Preparer Exam Specifications
NATP Comments on CPE Provider Approval
NATP Discussion Paper Submitted to the House of Representatives Ways and Means Subcommittee on Oversight - July 28, 2011
NATP Comments on Registered Tax Return Preparer Exam
Notice 2011-45 - Restrictions on the use of the term Registered Tax Return Preparer
NATP Comments on Proposed Circular 230 Regulations
Form W-12, IRS Paid Preparer Tax Identification Number (PTIN) Application