PTIN Requirements for Supervised and Non-Form 1040 Preparers

Post Date: 4/25/12
Last Updated: 4/25/12

Summary

Cross References
• REG-124791-11
• Notice 2011-6

All tax return preparers who are compensated for preparing or assisting in the preparation of all or substantially all of a U.S. federal tax return or claim for refund must obtain a preparer tax identification number (PTIN). This requirement includes EAs, CPAs, Attorneys, and Registered Tax Return Preparers (RTRPs). On April 9, 2012, the IRS issued proposed regulations under IRC §6109 that clarifies information in Notice 2011-6 concerning the PTIN requirement for supervised preparers and non-Form 1040 series preparers.

Supervised preparers. Even though a supervised preparer does not actually sign a tax return or claim for refund, a supervised preparer is still required to obtain a PTIN. The regulations clarify that the supervised preparer does not have to become an EA, CPA, Attorney, or RTRP to obtain a PTIN.

A supervised preparer is defined as an individual 18 years of age or older who is paid to prepare or assist in the preparation of a return if:
• The individual is supervised by an attorney, certified public accountant, enrolled agent, enrolled retirement plan agent, or enrolled actuary authorized to practice before the IRS, and
• The supervising attorney, certified public accountant, enrolled agent, enrolled retirement plan agent, or enrolled actuary signs the tax returns or claims for refund prepared by the individual, and
• The individual is employed at the law firm, CPA firm, or other recognized firm of the tax return preparer who signs the tax return or claim for refund, and
• The individual passes the requisite tax compliance check and suitability check (when available).

Other recognized firms for purposes of the above requirements is a firm that has one or more employees lawfully engaged in practice before the IRS and that is 80% or more owned by one or more attorneys, certified public accountants, enrolled agents, enrolled actuaries, or enrolled retirement plan agents authorized to practice before the IRS.

An individual supervised by an RTRP is not a supervised preparer under the proposed regulations.

Non-Form 1040 series preparers. Only Form 1040 series preparers are required to be an EA, CPA, Attorney, or RTRP at this time. Currently, the competency test to become an RTRP only covers Form 1040 series returns. The proposed regulations clarify that the terms tax return and claim for refund of tax include all tax forms submitted to the IRS except forms that the IRS specifically excludes in Notice 2011-6.

Thus, for example, an individual who is paid to prepare payroll tax returns (Forms 941, 940, etc.) is required to obtain a PTIN as the paid preparer, even though such individual is not required to be an EA, CPA, Attorney, or RTRP (assuming such individual does not prepare any Form 1040 series returns).

The proposed regulations clarify that the IRS may conduct a suitability check, in addition to a federal tax compliance check on such individual who applies for or renews a PTIN.

See printable version for the complete list of excluded forms.
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