The Woodward News

Local News

July 10, 2012

Test time coming up for income tax preparers

Brandi Thomas Woodward News

Woodward, Okla. — Tax preparers will have till December 31, 2013 to take their competency exam in order to continue to be paid tax preparers, according to the IRS.

Around 3,600 Oklahoma tax preparers still need to take this exam, according to David Stell, IRS spokesman for Arkansas and Oklahoma.

Stell said the closest testing facilities for the Woodward area are in Tulsa and Oklahoma City.

"The reason for this test is that 3 years ago the IRS began a program to register all paid preparers and require them to pass a competency and ethics training," Stell said. "It is an effort to raise the level of competence and ethics in the tax industry by the IRS."

According to a press release, on June 4, 2009 IRS Commissioner Doug Shulman launched a six month review focusing on the competency and conduct of paid tax return preparers. This resulted from a recognition that paid preparers were an important element in the integrity of the nations tax system.

The review included a series of public hearings with the tax preparation community, consumer advocates, oversight groups and taxpayers.  And the result of the review was a requirement that paid tax preparers meet certain competency and ethics requirements.

According to IRS.gov, the preparer's test is 120 questions that are either multiple choice or true-false type questions.

The questions in the test include, but are not limited to, the following subject areas: preliminary work and collection of taxpayer data; treatment of income and assets; deductions and credits; other taxes beyond income tax; completion of the filing process; practices and procedures; and ethics, according to IRS.gov.

You can find more information on these topics and study guides at www.irs.gov/taxpros/tests.

Preparers do not have to take the test every year, but have to take continuing education courses to stay current, Stell said.

According to the press release, tax preparers must complete 15 hours of continuing education courses each year.

The continuing education credits must include 10 hours in federal tax law, 3 in federal tax law changes and 2 hours in ethics.  This became effective in January 2012.

However, even before taking the test, the first step that preparers have to take is to register by getting their preparer tax ID number (PTIN), according to Stell.  They must go to www.irs.gov/ptin to get their ID number.

"Preparers had to be registered (as of) the end of 2011 and that number (PTIN) was required to be put on all tax returns they file," Stell said.

The registration process allows the IRS to keep track of tax preparers and know which ones are meeting competency and ethical standards.

The IRS is also in the process of using the preparer registry to develop a publicly searchable database that will allow people to see if their tax preparers have met IRS standards or to find a registered tax preparer in their area, according to IRS.gov.

For more information about the tax preparer's test and registry, visit the IRS website at www.irs.gov/ptin.

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