Lawmakers express support for tax preparer program

The IRS says its initiative is needed because there had been no competency requirements for paid tax preparers, even though some 60 percent of taxpayers use one. The Government Accountability Office has also found, in past reports, that paid preparers’ returns at times have sizable errors.

The agency has already handed out more than 700,000 personal identification numbers under the preparer initiative, which is set to be implemented over the next several years. The program also mandates competency tests for preparers and a certain amount of yearly continuing education.

At Thursday’s hearing, lawmakers like Rep. Xavier Becerra (D-Calif.) complimented the IRS for pushing forward on the program, saying it could be a boon to taxpayers who have wrongly trusted preparers and found themselves audited.

Still, Boustany also expressed concern about the extra costs preparers will face because of those new regulations, citing an estimated $51 million to $77 million just in new registration fees.

And David Williams, director of the IRS Return Preparer Office, responded to concerns about taxpayer awareness of the program by saying the agency will implement a nationwide education campaign — once preparers have started taking competency tests and continuing education courses.

“It’s just that today, we’re just starting the program. And I don’t want taxpayers to be looking for more than is there,” Williams said, responding to Rep. John Lewis (D-Ga.). “Because it’s not there yet.”

Williams estimated that the competency tests would begin later this year, and the education courses sometime next year.

For their part, some stakeholders in the debate had other concerns. Lonnie Gary of the National Association of Enrolled Agents, for instance, questioned in his opening statement why preparers would be allowed to handle all tax returns when the competency test only covers the basic 1040 form.

And Kathy Pickering of H&R Block said the competency test and continuing education would cause new burdens for her company, due to training it already requires.

Still, lawmakers on both sides of the aisle seem to believe the initiative is an area where the two parties can cooperate, with Boustany signaling Ways and Means would also be looking at how the tax code is administered in its push for tax reform.

“We’ll have our partisan moments here,” Boustany said. “But there’s some things we can do in a bipartisan way that actually serve the taxpayer.”