By U.S. Mail and e-mail to www.regulations.gov
Internal Revenue Service
CC:PA:LPD:PR (REG-134235-08), Room 5205
P.O. Box 7604
Ben Franklin Station
Washington, DC 20044
Re: Furnishing Identifying Number of Tax Return Preparer (REG-134235-08)
The National Association of Enrolled Agents (NAEA) appreciates the opportunities IRS has offered to provide input as the agency attempts to implement a program to increase return preparer accuracy and protect taxpayers from those who cannot or will not interpret the Internal Revenue Code (IRC) correctly. As the organization representing the interests of 46,000 enrolled agents, NAEA is well positioned to offer an informed and practical perspective about how to increase a taxpayer’s confidence that his/her return preparer is producing a true, complete and accurate tax return.
With respect to the § 6109 proposed regulations at hand, we note that they are in the main both straightforward and reasonable. Nonetheless, we raise the following issues for the agency’s consideration:
We would suggest the inclusion of an intermediate example where the staff person assists in the collection of data from the taxpayer using a questionnaire or tax organizer prepared by the registered tax preparer and is supervised directly by the tax return preparer. The reality is often much of the upfront data collected does not require any discretion or independent judgment on the part of the individual assisting the taxpayer. This data can lead to the individual inputting the data directly or it might indicate the need for a registered tax preparer to do an interview of taxpayer, for instance on issues such as dependents or earned income credit.
Aside from our concern about what appears to be a redundant registration requirement (EAs are already governed by the agency and must apply and pay for a renewal that includes background checks), we are concerned about the timeframe the agency has allowed the external vendor to create the registration infrastructure. While the agency issued a Request for Proposal on January 13, 2010, to the best of our knowledge an award has not yet been made. At best, assuming no contract protests, the selected vendor would have four months to produce the system. Should anything unanticipated slow the registration delivery date, we wonder whether the agency has a contingency plan that would allow for a later implementation date of the mandatory PTIN use.
We question why an enrolled agent—or any other practitioner who renews their right to practice before the agency—should be saddled with two three-year renewal cycles, one for a PTIN and the other for the right to represent taxpayers when the work the Service is doing is largely redundant. We strongly suggest that the Form 8554 renewal also serve as the renewal for the PTIN registration. This would, we hope, eliminate a duplicate process and a duplicate fee.
A meaningful oversight regime presents the Service with a significant opportunity both to increase tax compliance and to level the playing field for all paid preparers. While we offer only a few observations on the § 6109 proposed regs, we suggest that the ultimate success or failure of this enterprise will rest upon thoughtful rule making and decisions centered on what is good for taxpayers rather than what is expedient for the agency or for the million or so unregulated preparers.
NAEA appreciates the opportunity to submit comments on REG-134235-08 § 6109 proposed regs. Should you seek further clarification or explanation of our positions, please contact NAEA at (202) 822-6232.
Sandra Martin, EA
cc: Douglas Shulman, Commissioner, Internal Revenue Service
Mark Ernst, Deputy Commissioner for Operations Support
Karen Hawkins, Director, Office of Professional Responsibility
David Williams, Executive Lead, Return Preparer Regulations Implementation