A change in tax law now will require some 87,000 people who prepare tax returns in Texas to have a nine-digit number that will identify them as a tax preparer.
It’s all in an effort to give tax agencies better control over the people taxpayers hire to prepare their returns. In the past, Texans have reported being overcharged by tax preparers who advertise one price but charge a different fee for their services. Often, those tax preparers pack up quickly after tax season and can’t be located should questions arise.
That isn’t the only change to rules regarding tax preparers. The Internal Revenue Service also is mandating that by the end of next year, tax professionals submit to a check of their backgrounds and pass a test to prove they are competent.
Attorneys and certified public accountants who are licensed by their oversight groups do not have to meet the requirements, nor do enrolled agents qualified by the IRS. People who work for firms operated by the attorneys and CPAs also are not subject because they are under professional supervision.
For those who must pass the test, some community colleges and private businesses have jumped in to offer classes to help the tax preparers study for the exam. The classes are 15 hours in length, and those who take them and pass the test will earn the title of registered tax preparer. Another 15 hours of ongoing education will be needed to maintain that title.
Taxpayers one day will be able to search via computer for the names of preparers who have passed the competency test and receive continuing education courses. For Texas taxpayers who do not want to pay too much to file their taxes, the requirements will be welcome news.
Source: Star-Telegram, “Be on guard when hiring a tax preparer,” Dave Lieber, Jan. 26, 2012