New Federal Tax Education Laws for Tax Preparers

The IRS has passed new federal tax education laws for regulating tax preparers. As part of the new federal tax education laws, the IRS will require all individuals who prepare tax returns for a fee to register. In addition, the new federal tax education laws require a tax preparer to obtain a preparer tax identification number.

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Mandatory tax return preparer registration is part of the new federal tax education laws in place for tax preparers to follow. The new federal tax education laws will require a tax preparer to renew their registration every 3 years.

The competency examination requirement part of the new federal tax education laws, states that the IRS will offer two competency examinations. One examination will cover wage and non-business income and the other examination will cover wage and small business income. Then , the new federal tax education laws will require a third test regarding business tax rules after the three-year implementation phase. The new federal tax education laws also state that the IRS is to develop transition rules to avoid significant interruption of tax preparation service during testing periods.

Additionally, as part of the new federal tax education laws, the IRS will require 15 hours of continuing professional tax education to be completed annually. Part of the 15 hours required to satisfy the new federal tax education laws, 3 hours will be in federal tax law updates, 2 hours of ethics, and 10 hours in federal tax topics. To follow the new federal tax education laws, the preparer must timely complete tax education and show this at registration renewal time. To insure the new federal tax education laws are being followed yearly, the IRS will perform random checks.

IRS website link for new federal tax education laws.

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Revised: 05/14/12