CTEC Education, Registration, and the RTRP Program

I recently attended a California Tax Education Counsel (CTEC) Education Provider meeting in Sacramento. This was a very enlightening meeting and a wake-up call for several education providers. At that meeting, CTEC introduced some new, stringent requirements that impact what is acceptable CE for CRTP registration. Interestingly enough, the new CTEC requirements are far more rigorous than the now-suspended IRS CE requirements. CTEC also introduced the new audit program aimed at eliminating overly easy and simplistic courses that overstate their CE credits. In addition, Susan Gaston of the IRS RPO program attended the meeting and provided insight into the status of the now-suspended RTRP program. To bring you up to speed, I would like to cover the issues one at a time as follows:

Status of CTEC - CTEC, unlike the Federal RTRP program that was established by IRS regulations, was established by the California Legislature. I served on the CTEC Board during its fledging years and helped draft its policies and education requirements. Some mistakenly believe that the CTEC registration and education requirements are tied to the IRS program. That is not true; CTEC is independent of the IRS program. CTEC was operational years before the RTRP program came into existence and will continue to function whether the IRS program is reinstated or not. True, the CTEC CE requirements were changed to match the IRS requirements, but the CTEC Board wisely adopted them when the IRS program came into existence so that California Registered Tax Preparers (CRTPs) could meet both the CTEC and IRS requirements with the same CE Courses.

Selecting a Provider – There are CTEC-approved providers as well as IRS-approved providers. CTEC requires that CTEC-approved providers also be IRS-approved providers (when the IRS program is in effect). Thus, when selecting a provider, make sure that the provider is CTEC-approved. It is conceivable that you could take a course from a provider that is only IRS-approved and the credits would not count for CTEC.

Inadequate Courses - CTEC has been aware for some time that certain providers' courses are overly simplistic and lack sufficient difficulty to provide any meaningful education value. In some courses, the exam questions are so unchallenging that a student could take the exam without reading the material, thereby satisfying his or her CE requirement in a fraction of the required study time. The following are examples of exam questions in one course that the CTEC review staff found to be of insufficient difficulty.

As a result, the CTEC Board adopted policies that give the course review staff the discretion to disqualify or reduce CE credits for courses that are not of sufficient difficulty, not clearly written, technically inaccurate, not current, incomplete, or insufficient to meet the course's learning objectives.

Inappropriate CE Awards – Some providers are awarding inappropriate CE credits for a course, providing awards far in excess of the time spent by the student. As a result, CTEC adopted a method of determining CE credits that is similar to the methods used by the National Association of State Boards of Accountancy (NASBA). Under the new policy, CE credit for a course must be determined by either:

  • Pilot testing the course with a minimum of three unrelated students, or
  • Using a word count formula based upon the average adult reading speed of 180 words per minute.

New Course Audit Procedures – Since education provider approval historically has been based upon CTEC reviewing only a single course of a provider, CTEC has adopted an annual audit program where the five most frequently taken courses will be audited by the CTEC review staff. This program was initiated this year, and three of the four audited so far failed the audit and are being recommended for disqualification.

In addition, at CTEC’s discretion, additional course audits can be initiated as the result of complaints related to inappropriate CE awards, insufficient difficulty, technical inaccuracies, and other course quality issues.

These audits can have some profound ramifications for both the education provider and the students taking their courses. Choose your education provider wisely. If you have been using a provider that gives inappropriate CE awards or offers courses that are overly simplistic, you may wish to reconsider following that path in the future.

Ban on IRS Publication Courses - Neither CTEC, the IRS, nor NASBA allows the use of a government publication as the syllabus for course. This new restriction was instituted in 2012 by CTEC and the IRS and follows a long-time policy of NASBA.

  • Lee Reams Sr.

  • Lee T. Reams is the Chief Technical Officer of ClientWhys. He is also an Enrolled Agent having managed a 600-plus client tax practice. Educated as an engineer, with a Bachelor's Degree in Mechanical Engineering, Lee left his engineering career in 1975 to expand his part-time tax practice into a full-time career.

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