Taxable Talk

The National Association of Enrolled Agents sent the IRS a letter stating that they didn’t like the idea of a voluntary tax preparer regulation program. (Full disclosure: I’m a member of the NAEA.) The NAEA pointed out that there’s already a voluntary preparer regulation program–Enrolled Agents.

The AICPA sent an even stronger letter saying much the same thing. The AICPA noted that there’s no statute allowing the program, it will be looked at as an end run around Loving v IRS, that the IRS didn’t comply with the Administrative Procedure Act, and that the proposal is arbitrary and capricious.

The IRS’s response? Instead of calling it “voluntary tax preparer regulation,” let’s throw a new name on it: Annual Filing Season Program. That will win hearts and minds over…

I expect the IRS’s next destination for this program is a District Court in the District of Columbia. The AICPA got it absolutely correct: The IRS has no legal justification for this program.

All of this reminds me of something from my days in high school where I was on the debate team. Every proposal had a “self-perpetuating program” of some sort. And that’s just what the bureaucracy at the IRS has done: They took the RTRP program, slapped a new label on it, made it voluntary, and voila, it must be legal. This looks to me to be a self-perpetuating program.

In Loving, the Court held that the IRS overstepped it bounds. The IRS’s stick is that you won’t be listed in an IRS master-database of tax professionals if you don’t sign up for this new program. If I’m an unenrolled tax preparer doesn’t sign up, isn’t it discrimination? The IRS has no right to discriminate against me, right? And that would be the case.

All-in-all, this appears to be a program that’s going to die in court again. I don’t know if the Institute for Justice will be fighting it, but it sure looks like the AICPA will. This has not been the best of weeks for the IRS.

Tags: PreparerRegistration

This entry was posted on Thursday, June 26th, 2014 at 7:16 pm and is filed under IRS. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.