AICPA Voices “Deep Concerns” about Voluntary Program Proposed by IRS To Regulate Tax Return Preparers

The AICPA has expressed its opposition to a proposed voluntary tax return preparer regulation program in a letter to IRS Commissioner John Koskinen. The IRS was blocked from implementing a mandatory regulation program by court decisions in Loving v. IRS.

The AICPA has “deep concerns with regard to a voluntary system, and the speed with which the IRS is moving to implement such a system,” says AICPA President and CEO Barry Melancon and Jeffrey Porter, chair of the AICPA tax executive committee. “We believe a voluntary program would create confusion regarding the relative proficiencies of the various types of preparers. In addition, the proposed voluntary system would undoubtedly leave the impression among most taxpayers that certain tax return preparers are endorsed by the Internal Revenue Service.”

Melancon and Porter called into question the proposal’s likely effectiveness. “As a practical matter, any voluntary regime constructed would still not address the problems with unethical and fraudulent tax return preparers.”

They also criticized the process the IRS is using and how quickly it is proceeding.  “We are concerned that the IRS is rapidly moving forward without widely disseminating the proposal or seeking public comments.”

Instead of the proposed voluntary program, the AICPA recommended in the letter that “the IRS should focus its efforts on utilization of the current preparer tax identification number (PTIN) program and increased taxpayer education.” Melancon and Porter noted that the Loving court decisions kept in place mandatory registration of paid tax return preparers and the issuance of unique PTINs, which allows the accumulation of important data on activities of specific tax return preparers as well as classes of preparers in a way that allows the IRS to tailor compliance and education programs in the most efficient manner.

Furthermore, Melancon and Porter wrote that “we also believe the IRS should administer the penalties and sanctions for which it currently has authority to identify and hold accountable incompetent and unethical return preparers.”