This week, U.S. Rep. Ted Yoho, R-Fla., paired up with U.S. Rep. Jimmy Panetta, D-Calif., on a bill empowering the IRS to set minimum standards for paid tax preparers.
Yoho and Panetta brought out the “Taxpayer Protection and Preparer Proficiency Act" to that purpose. Over in the U.S. Senate, Democrats, led by U.S. Sen. Ron Wyden, D-Ore., and U.S. Sen. Ben Cardin, D-Md., have a companion measure.
“While around 60 percent of taxpayers use paid preparers, there are currently no minimum federal competency standards for tax preparers. Therefore, they have no obligation to receive tax education or training or demonstrate competency in tax return preparation – leaving many who rely on these services vulnerable,” Yoho’s office noted. “Due to the absence of such standards, the IRS receives more than 10,000 complaints per year about bad actors in this field. While the Justice Department and IRS can prosecute preparers for fraud, the D.C. Circuit’s 2014 decision in Loving v. IRS weakened taxpayer protections by barring prosecution for incompetence.”
Panetta’s and Yoho’s bill would ensure tax preparers “demonstrate competency in preparing returns, claims for refund and associated documents” which includes continuing education requirements (CERs). The bill would also let the IRS rescind taxpayer identification numbers (PTINs) of corrupt and incompetent tax preparers.
“Families and individuals all over the country rely on the services of paid tax-preparers during tax season. As American citizens, we are required to pay our taxes and therefore should at least ensure that those who prepare our taxes are competent. However, due to a lack of minimum federal standards, many are taken advantage of by unqualified tax preparers who are looking to make a profit,” said Yoho on Tuesday.
“The Taxpayer Protection and Preparer Proficiency Act will restore the ability of Treasury and the IRS to set federal standards of tax practice for all paid return preparers which will provide families and individuals with protection and assurance during tax season,” Yoho added.
“All U.S. taxpayers should know their tax preparers are qualified. Our bipartisan bill ensures that preparers meet competency standards and are held accountable, protecting filers from fraud and reducing error rates and audits,” said Panetta.
“Incompetent or crooked paid tax preparers regularly exploit taxpayers to pad their bottom line. States like Oregon have led in this area by requiring basic standards for preparers, and it’s critical that we restore federal standards to protect all taxpayers,” said Wyden. “It’s a no-brainer to protect your constituents from unscrupulous scammers, and I’d like to thank Congressmen Jimmy Panetta and Ted Yoho for introducing bipartisan companion legislation in the House of Representatives.”
