Tax Update: Voluntary Continuing Education Program for Unenrolled Tax Return Preparers

The IRS started a new voluntary program that allows tax return preparers to show the IRS and their customers that they are keeping up with tax law changes and increasing their tax knowledge by completing tax related continuing education courses each year. It is called the Annual Filing Season Program. Preparers who choose to participate will receive a Record of Completion from the IRS, provided that they complete the required hours of continuing education, have an active PTIN, and consent to adhere to specific obligations under Circular 230.

Any preparer who receives a Record of Completion for the 2016 Filing Season will have limited representation rights before the IRS. This means that they will be able to represent their clients, whose returns they have signed, before revenue agents, customer service representatives, and similar IRS employees. All other unenrolled return preparers will have no representation rights and will only be allowed to complete returns and sign them.

Another advantage for tax return preparers who participate in the Annual Filing Season Program is inclusion in the database of tax return preparers on the IRS website.

This is how the program works:

In order to receive an Annual Filing Season Program – Record of Completion for calendar year 2016, most preparers must meet the following requirements by December 31, 2015:

• Complete 18 hours of continuing education which must include:
• A six hour Annual Federal Tax Refresher course that covers filing season issues and federal tax law updates. The course must also include a knowledge-based comprehensive test (that the tax preparer must pass) that is given at the end of the course by the continuing education provider.
• Seven hours of other federal tax law topics
• Two hours of ethics
• Renew their PTIN
• Consent to adhere to specific practice obligations outlined in Circular 230, Section 10.51

All continuing education courses must be taken from an IRS approved CE provider and completed by the end of each calendar year.

Unenrolled preparers who passed the Registered Tax Return Preparer test, are an established participant in a state based return preparer program, are a VITA volunteer, or have met a limited number of other criteria will be considered exempt. This means their continuing education hours requirement will be 15 hours. For more details on which unenrolled preparers are exempt and the details of their requirements, see the Reduced Requirements for Exempt Individuals on the IRS website.

For more information on the IRS Annual Filing Season Program see the following:

• Main Annual Filing Season Program page on the IRS website
• General Requirements
• Chart of Annual Filing Season Program CE Requirements

IRS Announces New Voluntary Program for Professional Tax Return Preparers

The IRS announced on June 26, 2014 that they will soon be issuing guidance on a new voluntary program for unenrolled professional tax return preparers. Under this new program, tax return preparers would be able to obtain a record of completion from the IRS for completing a required number of hours of continuing education. All tax return preparers who elect to participate in this program and receive a record of completion will be included in a database on IRS.gov that will be available by January 2015 to help taxpayers determine return tax preparer qualifications.

In order for an unenrolled tax return preparer to obtain an IRS record of completion, they must complete the following number of hours of continuing education:

• For the upcoming 2015 filing season only:
• Complete 11 hours of continuing education (CE) from an IRS approved CE provider as follows:
• 6 hours – Federal tax filing season refresher course (which includes a comprehensive test at completion)
• 3 hours – Other federal tax law topics
• 2 hours – Ethics

This requirement will need to be met by December 31, 2014.

• Each year after 2015:
• Complete 18 hours of continuing education (CE) from an IRS approved CE provider as follows:
• 6 hours – Federal tax filing season refresher course (which includes a comprehensive test at completion)
• 10 hours – Other federal tax law topics
• 2 hours – Ethics

Once the continuing education requirement is met, a professional tax preparer will also be required to consent to the duties and restrictions related to practice before the IRS that are detailed in Circular 230, Section 10.51.

A list of all IRS approved CE providers (https://ssl.kinsail.com/partners/irs/publicListing.asp) is available on IRS.gov and now includes a new column indicating which providers plan to offer the qualifying courses.

For further details, see the New IRS Filing Season Program Unveiled for Tax Return Preparers (http://www.irs.gov/uac/Newsroom/New-IRS-Filing-Season-Program-Unveiled-for-Tax-Return-Preparers) news release on the IRS website.