D.C. Circuit reinstates IRS PTIN fee

By Sally P. Schreiber, J.D.

The D.C. Circuit held that the IRS has authority to charge a user fee for preparer tax identification numbers (PTINs), paving the way for the agency to reinstate a fee for obtaining and renewing a PTIN (Montrois, No. 17-5204 (D.C. Cir. 3/1/19)). However, the appeals court remanded the case to the District Court for the District of Columbia to determine if the amount of the fee (the IRS last charged a fee of $33 in 2017) unreasonably exceeds the costs to the IRS to issue and maintain PTINs.

A valid PTIN is required for anyone who prepares or assists in preparing a federal tax return for compensation. The IRS stopped charging a user fee for PTINs in 2017 after it lost a case in federal district court (Steele, 260 F. Supp. 3d 52 (D.D.C. 2017)) that held the IRS did not have authority to charge a fee to tax preparers to obtain PTINs. For more on this issue, see "Tax Trends: IRS Can Again Charge Preparers for PTINs."

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