Summary#
This bill makes many changes to rules for paid tax return preparers. It expands the meaning of "return" to include related reports. It increases civil penalties for a range of preparer errors and failures to follow identifying-number rules. It creates new criminal penalties for willful misuse or supplying another person's preparer identifying number. It requires the Secretary of the Treasury (the IRS) to run programs to reduce mistakes, to publish common preparer errors, and to work with States. It also creates rules for issuing, suspending, revoking, and reinstating preparer identifying numbers, and sets education, background-check, and state-license pathways for getting those numbers. The bill adds penalties for negotiating a taxpayer's check or misappropriating an electronic refund and requires preparer identification on certain offers-in-compromise. It directs the GAO to study information sharing between the IRS and State tax authorities.
Effective dates in the bill include: some changes take effect on enactment, some apply to returns or claims filed 18 months after enactment, and some program and registration rules take effect 180 days or specify other timeframes (for example, a GAO report due in 18 months, and publication of common errors within 36 months). Specific timing depends on each provision in the text.
What it means for you#
- If you use a paid preparer: your preparer must provide a valid preparer identifying number on returns and some other documents. The bill requires steps to make sure numbers are valid before a return is accepted.
- If you are a paid preparer: you may face higher civil penalties for many errors, new rules about acceptable identifying numbers, and possible suspension, revocation, or criminal charges for willful misuse of another person's identifying number. You may need to complete required education and pass suitability checks (including background checks) to get or renew a preparer identifying number. The IRS will publish common errors and reasons preparers are disciplined.
- If you file electronically or originate filings for others: the bill creates rules and penalties specific to electronic filing identification numbers and aims to give preparers a chance to correct invalid numbers before penalties apply.
Expenses#
- The bill requires the IRS to set up and run programs to improve compliance, to publish lists of errors and approved courses, and to administer preparer identifying number issuance, suspension, and reinstatement procedures.
- The bill requires a GAO study and report on information sharing between the IRS and States.
- No publicly available information on estimated federal costs or detailed budget impacts is included in the bill text provided.
Proponents' View#
No publicly available information.
Opponents' View#
No publicly available information.