Key Facts About IRS Tax Preparer Registration

Updated August 26, 2011

  • Most Current Information
    • Testing is scheduled to begin this October.
    • Testing fee will be $100-$125.
    • Continuing Education is expected to begin January 2012.
    • Registration period is changing from an annual basis to a calendar year basis beginning with calendar year 2012.
    • Registration for 2012 begins on October 16, 2011.
    • As registered return preparers renew their PTINs for 2012 or take the test this Fall, they will be asked to submit their fingerprints to the IRS. This is to enable the IRS to perform background checks as part of the suitability process. Fingerprinting Fee will be $60-$90.
    • IRS added a new type of tax return preparer. See Supervised Non-Signing Tax Return Preparer below for more information.
    • See the IRS FAQs for answers to questions about return preparer registration.
  • Testing Requirement
    • Fee will be $100-$125.
    • EAs, CPAs and Attorneys do not need to take a competency test.
    • Only one basic 1040 exam will be given
      -Changed from the two exams they originally proposed because only Federal individual return preparers are required to take the exam at this time.
    • Preparers who have already registered have until
      December 31, 2013 to pass the exam.
    • Preparers who only preparer non-1040 Federal returns are not required to take a test until the IRS creates one for the other Federal form types.
    • The testing will only be offered in English initially.
    • Preparers who register for the first time after the exam has begun will be required to pass the exam before they obtain a PTIN.
  • Continuing Education Requirement
    • Once this requirement begins (expected to begin in January 2012), registered preparers must complete 15 hours per year broken down as follows:
      • 2 hours of Ethics
      • 3 hours of Federal tax law update
      • 10 hours of general Federal tax law
  • Who must register and obtain a PTIN
    All paid preparers who prepare any type of Federal tax return must register and obtain a PTIN.This includes:

    • EAs, CPAs, attorneys and other preparers who obtained a PTIN before September 2010.
    • Preparers who are registered with a state (such as Oregon, California, Maryland, etc.).
    • Individuals who only preparer payroll and/or non-1040 Federal returns (corporate, partnership, estates and trusts, etc.).
  • Supervised Non-Signing Tax Return Preparers
    At the end of 2010, the IRS released IRS Notice 2011-6 which outlines the rules governing tax return preparers.In this Notice, the IRS outlined the rules governing tax return preparers that are supervised by an attorney, CPA or Enrolled Agent. These preparers must obtain a PTIN but do not have to take the exam or complete continuing education.

    When the preparers initially register and reregister they will be required to state that they are a supervised tax return preparer and enter their supervising preparer’s PTIN. The IRS will be contacting the supervising preparer to ensure the information is correct.

  • How to register
    • Registration can be accessed via irs.gov through the Tax Professional Page. The website address is: http://www.irs.gov/taxpros/article/0,,id=210909,00.html.
    • If you register online you must pay the registration fee electronically.
      • Options are: credit card, debit card or E-check
    • Current registration fee is $64.25. This amount may change in future years.
    • Preparers must have an SSN in order to obtain a PTIN.
      • Only exceptions are for taxpayers who have an objection to obtaining an SSN for religious reasons or;
      • For foreign tax return preparers who do not reside in the US.
    • Issuance of a PTIN or the registering of an existing PTIN is done immediately while you are online.

Other things to know about registration:

    • Two questions will be asked when registering:
      • Are you current with your tax obligations to the IRS?
      • Have you been convicted of a felony in the last 10 years?
    • Tax Compliance check:
      • Current in filing of individual, business and payroll tax returns
      • Current with all tax liabilities with IRS
    • Criminal Background check
      Beginning this Fall (2011) you must submit your fingerprints to the IRS.
    • Applying for a new PTIN using Form W-7P or IRS E-Services is no longer available.

Will IRS reject returns for not having a PTIN or the PTIN is not registered this coming filing season (2012)?
In order to reject an individual income tax return for an invalid PTIN the IRS needs to obtain legislative approval from Congress. Therefore, for this past tax season and for the 2012 filing season, the IRS will not be rejecting returns that contain a nonregistered PTIN.

2011 Filing Season:
In July, the IRS began sending letters to 100,000 paid preparers who either used an SSN or a nonregistered PTIN on 2010 federal individual returns.

2012 Filing Season:
Stayed tuned for more information on what the IRS will be doing to enforce the PTIN rules for the 2012 filing season.

  • New IRS Return Preparer Office has been established. It will manage the following:
    • Continuing Education
    • Testing
    • Registration system and process
    • Compliance
  • IRS Office of Professional Responsibility
    • This office will oversee registered tax return preparers’ adherence to ethical conduct and professional standards contained in
      IRS Circular 230.
    • This is the office that can take a PTIN away from a registered preparer.
  • Definition of Tax Return Preparer
    • The definition in IRC Section 6109 regulations is very broad:
      For purposes of obtaining a PTIN only, a tax return preparer is any individual who is compensated for preparing, or assisting in the preparation of all or substantially all of a Federal tax return or claim of refund.
    • The key factor to remember for a non-signing tax preparer is Are they making decisions on the amount and character of entries on a return and/or making determinations with respect to the proper application of the tax laws to the information in order to determine the client’s tax liability?  If they are, then they are considered to be a tax return preparer and they will be required to register and obtain a PTIN.
  • Registered Preparers ethical conduct will be governed by the IRS Circular 230
    • Circular 230 are the regulations governing practice before the Internal Revenue Service.
    • Compliance to Circular 230 is administered by the IRS Office of Professional Responsibility.
    • These regulations are being revised to incorporate registered tax return preparers. They will do this by revising the definition of practice before the IRS to include the preparation of tax returns.
    • The Circular 230 revisions were finalized in June 2011 and will go into effect on August 2, 2011.