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Congress Renews Effort to Regulate Tax Preparers

December 4th, 2015
There's a move afoot in Congress to certify tax preparers and require them to take qualification exams, attend continuing education classes every year, and undergo a background check.

Named theĀ Tax Return Preparer Competency Act, the bill was introduced last month by two Republican House members. The goal, they explained, is to reduce tax preparer fraud, particularly by fly-by-night operators who open temporary offices every tax season.

"There are no minimum standards to stipulate who can charge for these services," said Rep. Diane Black, R-Tenn. "This lack of accountability puts Americans at unnecessary risk and contributes to rampant improper payments within the tax system."

Among the IRS' "Dirty Dozen" list of tax scams are preparers colluding with taxpayers to hide income or inflate refunds. "There are some dishonest preparers who set up shop each filing season to perpetrate refund fraud, identity theft and other scams that hurt taxpayers," the IRS says.

The IRS itself initiated a regulatory system for preparers as a part of the
Registered Tax Return Preparer program. It required competency testing and continuing education, but a court invalidated the system saying the agency exceeded its authority in setting it up. Since then, various bills have been introduced in Congress to give the IRS such authority, including two earlier this year.

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