IRS Finds 100,000 Preparers Did Not Comply with PTIN Rules

By Alistair M. Nevius, J.D.

From the IRS

The IRS announced that it has identified approximately 100,000 tax return preparers who did not comply with the new rules for preparer tax identification numbers (PTINs), and it is sending them letters (IR-2011-74).

All tax return preparers (including CPAs, attorneys, and enrolled agents) were required to apply for and obtain a PTIN—even if they already had one—before preparing any federal tax returns for compensation in 2011. Approximately 712,000 preparers have obtained new PTINs under the registration program, which launched last September.

The IRS said that it is sending letters to preparers who used outdated PTINs or their Social Security numbers as identifying numbers on returns they prepared this past tax season. The letters explain the PTIN registration requirement and tell the preparers how to register for a new PTIN or renew an old PTIN.

The IRS also announced that it is working to detect what it calls “ghost preparers”—that is, preparers who attempt to avoid the new return preparer registration program by not signing returns they prepare. When the IRS identifies taxpayers who appear to have had assistance with their returns but whose returns lack tax return preparer signatures, it will send them a letter informing them how to file a complaint against preparers who fail to sign returns and explaining how to choose legitimate tax preparers.

The IRS is also working to identify tax return preparers who make repeated errors.

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