Part III – Administrative, Procedural, and Miscellaneous Restrictions on Use of the Term Registered Tax Return Preparer Notice 2011-45 The Department of the Treasury and the IRS are implementing the recommendations contained in Publication 4832, “Return Preparer Review.” As part of this implementation, the Department of the Treasury and the IRS have issued final regulations
IRS Issues Proposed Regulations That Would Require Tax Preparers to File Due Diligence Checklist with All EITC Claims Submitted in 2012 IR-2011-98, Oct. 6, 2011 WASHINGTON —The Internal Revenue Service announced today that it is issuing proposed regulations that would require paid tax return preparers, beginning in 2012, to file a due diligence checklist, Form
Recent IRS News View recent, tax-related IRS news releases below. Resources for Tax Preparers: IRS Releases Specifications for Registered Tax Return Preparer Test IR-2011-89, Sept. 6, 2011 WASHINGTON — The Internal Revenue Service today released the specifications for the competency test individuals must pass to become a Registered Tax Return Preparer. The test is part of an ongoing
Tax preparation software for tax preparers and PTIN hassle. WASHINGTON, D.C. (NOVEMBER 23, 2011) The Internal Revenue Service said it plans to add a new option to its Preparer Tax Identification Number system in December for users who need to change the email address associated with their online PTIN accounts. The new option
In 2012, Many Tax Benefits Increase Due to Inflation Adjustments IR-2011-104, Oct. 20, 2011 WASHINGTON — For tax year 2012, personal exemptions and standard deductions will rise and tax brackets will widen due to inflation, the Internal Revenue Service announced today. By law, the dollar amounts for a variety of tax provisions, affecting virtually every
The Internal Revenue Service is temporarily shelving its controversial plan to fingerprint tax preparers, IRS Commissioner Doug Shulman said Tuesday. Speaking at the American Institute of CPAs’ National Tax Conference, Shulman described some of the IRS’s latest moves, including ones influenced by the AICPA. The AICPA wrote to Shulman last month asking the agency
In the wake of studies that found that tax returns filed by paid preparers can be riddled with mistakes, the Internal Revenue Service is clamping down on the industry. Up to now, paid tax preparers in the vast majority of states were free to hold themselves out as experts without any training whatsoever. Nor did they
BY MICHAEL COHN
The Internal Revenue Service plans to start fingerprinting thousands of tax preparers as part of its oversight program and run the fingerprints through an FBI database.
The IRS released more details on its tax preparer oversight program on Wednesday, and said registered tax return preparers would now be required to renew their Preparer Tax Identification Numbers on an annual basis. In addition, the 15-hour continuing education requirement will take effect next year. » Read more..
The Internal Revenue Service released the specifications on Tuesday for the competency test that individuals must pass to become a Registered Tax Return Preparer.
The test is part of an ongoing effort by the IRS to enhance its oversight of the tax preparation industry. That effort began with the requirements for all tax preparers to register with the IRS and receive a Preparer Tax Identification Number, or PTIN, for this tax season. The other components of the IRS requirements include testing and continuing education.
Preparers who pass this test, along with a background check and tax compliance check, as well as complete 15 hours of continuing education annually will have a new designation: Registered Tax Return Preparer.
The specifications identify the major topics that will be covered by the test, which will be available starting » Read more..
This article written by Kelly Phillips Erb
It’s not just the kids that have to take tests these days. Attorneys, CPAs, doctors, engineers, architects and nurses must generally pass standardized competency tests in order to practice. You can now add tax professionals to the list.
Over the past year, the IRS has made increased oversight of tax professional a top priority. As a first step, the IRS began requiring tax professionals to register for a PTIN (Preparer Tax Identification Number) in 2010 for the 2011 season. » Read more..
IRS Provides Tax Relief to Victims of Hurricane Irene
Updated 9/15, 9/14, 9/13, 9/12, 9/9, 9/8, 9/7, 9/2 2011 with expanded federal disaster area.
IR-2011-87, Sept. 1, 2011
WASHINGTON –– The Internal Revenue Service is providing tax relief to individual and business taxpayers impacted by Hurricane Irene.
The IRS announced today that certain taxpayers in Connecticut, Massachusetts, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Puerto Rico and Vermont will receive tax relief, and other locations are expected to be added in coming days following additional damage assessments by the Federal Emergency Management Agency (FEMA).
The tax relief postpones certain tax filing and payment deadlines to Oct. 31, 2011. It includes corporations and businesses that previously obtained an extension until Sept. 15, 2011, to file their 2010 returns and individuals and businesses that received a similar extension until » Read more..
The IRS will soon be looking over the shoulders of tax return preparers and their clients when they report stock sales on Schedule D, Form 1040.
For stock acquired and sold after 2010, the IRS will receive information returns from security brokers reporting the adjusted basis of the stock sold and whether the capital gain or loss on the sale is short-term or long-term. These information returns will allow the IRS to double check what you report for your clients on Schedule D.
The silver lining for your clients is that they will have some control over what their brokers report in certain situations. Your clients should receive information and advice from their brokers about the new rules. However, if there are slip-ups, you are going to have to explain to your clients why their tax bill is higher than they expected. » Read more..
A tax return is signed under penalties of perjury and is not an opening offer, quipped journalist Lee Sheppard. True, but we all make mistakes. Besides, some items—like an amended an Form K-1 or 1099, may show up after you’ve filed. The IRS doesn’texactly allow tax return do-overs.
Still, if you discover an error on your tax return, the only way to fix it is to amend your return. There are many myths about amended returns, but the IRS recently listed some things they want you to know. See IRS Summertime Tax Tip 2011-12.
Do Amend. If your filing status, dependents, total income, deductions or credits were reported incorrectly, amend. » Read more..
Same-sex married couples have tough tax filing issues, far more complex than heterosexual couples. Clearly that shouldn’t be true, but for the time being it is. To its credit, New York State has released helpful information about tax filing under the Marriage Equality Act. The Marriage Equality Act was signed into law June 24, 2011. Little more than a month later the New York Department of Taxation and Finance weighed in with this guidance.
Here are the highlights:
Different Filing Status. Same-sex married couples in New York must file their personal tax returns as married even though their marriage isn’t recognized for federal tax purposes. You use a filing status of single or head of household on your federal Form 1040, but for New York, either married filing » Read more..
It’s nothing but lawless anarchy in the unregulated tax preparation industry. Just look at what’s happening out there:
- A practitioner spends years helping taxpayers improperly deduct “lifestyle expenses” — their clothes, their make up — even their pets!
- A practitioner costs the Treasury hundreds of millions of dollars setting up corporations and arranging sham transactions to hide income in a tax-exempt shell.
- Another practitioner helps taxpayers unlawfully avoid taxes using sham trusts and transparently phony legal arguments.
It’s no wonder the IRS has started its huge new program to register all unregulated tax practitioners, make them pass a competency test, and subject them to continuing education each year.
Oh, wait… these cases didn’t involve unregulated preparers. They involved an Enrolled Agent, an Attorney, and a CPA — all tax professionals that already have to pass much stiffer entrance tests and take more continuing education that anything proposed under the new unregulated preparer rules. » Read more..
You may think the IRS pursues all taxes equally but they don’t. The IRS is especially vigorous in going after payroll taxes withheld from wages that somehow don’t get paid to the government. This is trust fund money that belongs to the government and was withheld from wages.
That makes any failure to pay—or even late payment—much worse. In fact, that’s so regardless of how or why the employer or its principals use the money. See No Get-Out-Of-Jail-Free Card For Payroll Tax Liability.
When a tax shortfall occurs in this setting, the IRS will usually make personal assessments against allresponsible persons who have ownership in or signature authority over the company and its payables. » Read more..
Does your business use an outside payroll service? Are you thinking of using one?
Payroll service companies perform an important function assisting employers comply with payroll tax laws. But these services pose risks for employers.
There are three categories of payroll service companies. In all three categories, the payroll service company computes employees’ withholdings and net pay, compiles payroll accounting records for the employer, and prepares payroll tax returns for the employer.
The first category of payroll service companies are payroll service providers (“PSPs”). A PSP prepares payroll tax returns using the employer’s employer identification number (“EIN”). The employer signs and files the tax returns. » Read more..
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