NATP responds to opposition to Section 504 of Taxpayer Assistance and Service Act

The National Association of Tax Professionals (NATP) is reaffirming its support for the Taxpayer Assistance and Service (TAS) Act and responding to concerns raised about Section 504, which addresses continuing education and oversight for paid tax return preparers.

On Oct. 28, NATP sent a letter to House Speaker Mike Johnson in response to a recent opposition letter challenging Section 504 and its potential effect on independent tax preparers.

NATP represents credentialed and noncredentialed tax professionals, including sole practitioners, independent preparers and owners of small, family-run tax practices.

Eighty-seven percent of NATP members are small-business owners, and approximately half are noncredentialed. That perspective is central to NATP’s position.

"Continuing education is essential to maintaining professional competency and protecting taxpayers," Scott Artman, CPA, CGMA, NATP CEO, said. Discussions on Section 504 should be based on what the legislation actually requires, rather than assumptions about its impact on small tax practices."

What NATP wants lawmakers to understand about Section 504

NATP’s letter addresses several claims about the proposal:

• Section 504 does not establish a new entrance exam for PTIN renewal. The proposal allows education requirements of up to 18 hours annually rather than imposing a universal 18-hour requirement. 
• The framework is designed to account for existing requirements. It would allow qualifying professional and state requirements to satisfy applicable standards and help avoid unnecessary duplication.
• PTIN registration and e-file suitability serve different purposes. Holding a PTIN identifies a paid preparer, but it does not by itself demonstrate competency or establish that the preparer has met requirements applicable to authorized IRS e-file providers.
• Projected small-business closures rely on assumptions about the proposal. Estimates cited in opposition to Section 504 assume every affected preparer would need 18 additional hours of education and do not account for the flexibility included in the legislation.
• Continuing education and enforcement address different concerns. Penalties and criminal laws address misconduct, while continuing education helps preparers keep their knowledge current as tax law changes.

NATP also notes that states including California and Oregon already maintain continuing education requirements for certain preparers while supporting established independent tax preparation markets.

Supporting standards without unnecessary burdens 

NATP would oppose requirements that unnecessarily restrict tax professionals’ ability to serve their clients.

At the same time, continuing education helps preparers stay current with changing tax law and supports accurate return preparation. NATP believes implementation should recognize education practitioners already complete and account for the financial and scheduling demands faced by small tax practices.

The TAS Act passed the Senate unanimously Sept. 30 and is now before the House of Representatives.

 NATP is urging the House to consider Section 504 based on its proposed requirements and practical effects on both taxpayers and preparers. NATP also welcomes the opportunity to continue sharing the experience of credentialed and noncredentialed tax professionals as lawmakers consider how education requirements could be implemented without creating unnecessary barriers to practice.

Read NATP’s full Oct. 28 letter to Speaker Johnson

Learn more about what’s included in the Taxpayer Assistance and Service Act

The National Association of Tax Professionals (NATP) is the largest nonprofit organization that works exclusively for tax professionals. We serve members through education, advocacy and community, providing the tools they need to navigate the tax code and the insights the media can trust.

Looking for a tax expert? Tom O’Saben, EA, director of tax content and government relations at NATP, is available for phone or video interviews to discuss federal tax topics, including tax law change and its implications, taxpayer issues, tax preparer regulation and more. To schedule an interview with O’Saben, contact [email protected] or [email protected].