PTIN Compliance Deadlines for the IRS

Over the past few months the IRS has been reminding paid preparers that they must renew or apply for their PTIN’s by January 1, 2012. If you are a paid preparer now is the time to ensure you are in compliance with the IRS before you complete your first return.

New regulations for paid preparers are rolling out in phases:

Phase 1: PTINs for Everyone

First Time PTIN Applicants
Beginning January 1, 2012 if you are a paid preparer you must have a Preparer Tax Identification Number before preparing returns. It will costs $64.25 per year for a first time PTIN Application and you can sign up for your PTIN online or by paper application. View this checklist before you start.

Renewal Applicants
To Renew online follow these easy steps:
1. Access your account online – Log in now if you have an online PTIN account
2. Renew your PTIN – Complete the online renewal application, verify personal information, and answer a few questions. You can view a checklist of what you need before you start.
3. Pay your fee – The renewal fee is $63 and you can pay by credit card or debit card.
View your next steps- There maybe additional steps that include testing and continuing education requirements.

The good news is that the IRS states it takes about 15 minutes to sign up or renew online to receive your PTIN.

Phase 2: Additional requirments for some preparers

Some Preparers have additional requirements in the future.
Attorney’s, Certified Public Accountants, and Enrolled Agents who are active and in good standing with their licensing have no additional requirements other than to renew their PTIN annually.
Supervised Preparer* and Non- 1040 Preparers** will need to renew their PTIN annually.

*Supervised Preparers are those who do not sign returns and who are employed by attorney, CPA or EA fims and are supervised by an attorney, CPA, or EA.
**Non-1040 preparers are those who do not prepare any Form 1040 series returns. Note: From 1040-PR and 1040-SS are not considered Form 1040 series returns for this purpose.

All other preparers will need to:
1. Renew PTIN annually
2. Pass a compentency test
3. Take continuing education courses annually

Competency testing has already begun and those who already have a PTIN will have until the end of 2013 to take and pass the exam.

The continuing education requirement is expected to start in 2012.

Please note that the IRS is also considering that certain tax return preparers undergo a background check as part of the PTIN requirments. Preparers will be contacted if they are required to undergo a background check in the future and any updates on background check requirements will be posted on the IRS website.

Please view this summary of the return preparer requirements.

Tax season is literally weeks away and now is the time to ensure you follow the IRS rules and regulations regarding PTIN processing.