The American Institute of CPAs is asking the Internal Revenue Service to reconsider some of the fees it plans to charge for competency exams and fingerprinting as part of its tax preparer oversight program.
The new fees would apply to individuals who are required to take the IRS competency examination in order to become Registered Tax Return Preparers and for fingerprinting those who participate in the Preparer Tax Identification Number, acceptance agent and authorized e-file provider programs.
In a letter Friday to IRS Commissioner Doug Shulman, AICPA Tax Executive Committee chair Patricia Thompson said the Institute was concerned about the fingerprinting of supervised non-signing, non-licensed staff at CPA firms and other firms of licensed professionals who are exempt from the testing and continuing education aspects of the IRS return preparer regulatory regime.
“We have serious concerns regarding the level of burden that the user fee regulations will place on CPA firms, primarily small and medium-size firms,” Thompson said at an IRS hearing Friday on the new proposals.
She suggested that the IRS should consider an alternative framework to allow CPA firms to engage a Consumer Reporting Agency regulated by the Federal Trade Commission to perform background checks to learn of any felony histories of supervised employees.
“We believe such an alternative could be crafted to meaningfully meet the IRS suitability check requirement through means other than fingerprinting, and in a less costly and less burdensome way to all parties impacted,” she said.
The preamble to the proposed IRS regulations indicates that the IRS does not intend to fingerprint CPAs at this time, but specifically requests comments on whether CPAs and others should be exempt.
“The AICPA strongly believes that CPAs should continue to be exempt from the fingerprinting process because it is redundant to the suitability process performed by the 55 state boards of accountancy that regulate CPAs in the United States and territories,” Thompson said. “Given the longstanding regulatory process provided by the state boards of accountancy, we do not believe it appropriate for the IRS to duplicate the cost or burden of fingerprinting CPAs.”
Another concern for the Institute is the possibility that the IRS might stop issuing provisional PTINs as soon as April 19, 2012. Thompson said that if the IRS stops issuing provisional PTINs, it would result in “benching” of college interns and other supervised employees who are newly hired or temporary while their PTIN applications are being processed, and would negatively affect a CPA firm’s ability to do business.
“CPA firms need a solution that flexibly addresses their immediate staffing needs without disruption,” she said. Furthermore, she added, the IRS should, at a minimum, allow provisional PTINs to be effective through Oct. 16, 2012 to accommodate the completion of tax returns that have been granted an extension.
