IRS Proposes PTIN Registration Fees

Last week, the Internal Revenue Service (IRS) released its proposed regulations to establish fees for those applying for preparer tax identification numbers (PTIN). This is the next step in the IRS's efforts to increase oversight of federal tax preparation.

Here's what CPAs must know: Beginning in 2011, all CPAs and other paid tax preparers must either re-register their PTINs or obtain a PTIN if they sign tax returns. CPAs, attorneys and enrolled agents all must renew their registrations every three years, but are exempt from testing, criminal background checks and continuing education requirements.

According to the IRS, the proposed $50 fee would cover technology costs and compliance and outreach efforts associated with the new PTIN program. An additional, smaller fee will be added by the third-party vendor chosen to operate the online registration system.

The PTIN proposal is not without its controversy. The CPA profession finds the requirement of PTINs for non-signing preparers problematic, as there are many employees at CPA firms who would fall into this category and would thus be subject to the testing and education requirements from which CPAs are exempt.

Read the VSCPA's July 1, 2010, letter to Virginia's federal representatives and senators for more on the Society's position.

The comment period for the IRS fee proposal ends August 23, 2010. Contact VSCPA Government Affairs Director Emily Walker at (804) 612-9428 if you have questions or comments.