Is Your PTIN Renewed? Ready for the New Tax Preparer Education Requirements? What About the Competency Test?
Have You Renewed Your PTIN? Just to remind you, unless you have already renewed your PTIN, it expired on December 31, 2011, and you cannot prepare returns once your PTIN has expired!
In the December 30th e-News for Tax Professionals, the IRS indicated that the on-line system will continue to accept renewals after the December 31st deadline. Should you have experienced technical difficulties while attempting to renew your PTIN, the IRS suggests that you visit the website for on-line trouble shooting tips.
The IRS will be sending all individuals who have not renewed their PTIN a letter. This January correspondence will include guidance for individuals with expired PTINs.
New Education Requirements Take Effect on January 1, 2011 -- Although there were no education requirements for renewing the PTIN for 2012, there will be for 2013. Education requirements for the various designations are as follows:
- Tax Return Preparer -- Tax return preparers, including those who have taken and passed the IRS competency test (RTRPs), are practitioners who are not CPAs, EAs, or attorneys. Beginning in 2012, these tax return preparers must complete 2 hours of ethics CE, 3 hours of Federal tax update CE, and 10 hours of study in federal tax subjects CE. These courses must be taken from an IRS-approved provider, and the course itself must have been pre-approved and assigned a unique course number by the IRS. The IRS will require each provider to verify your education; thus, you will need to provide your PTIN number when taking a course. In order to renew your PTIN for 2013, you must have completed the requisite 15 hours of continuing education!
ClientWhys has already been approved as an education provider and offers several different approved courses, including a 15-hour bundle that enables you to meet your annual CE requirement.
- Enrolled Agent -- EAs must report their education upon renewing their enrollment every three years and are not required to verify their education in order to renew their PTIN. However, their EA license must be current. Even so, the new IRS education requirements do impact EAs as follows: Beginning in 2012, EAs must take continuing education courses from an IRS-approved provider, and the courses must be pre-approved and must have been assigned a unique course number by the IRS. In addition, the IRS has tightened its standards and no longer allows courses that use IRS publications as the course material. Moreover, self-study courses must be interactive, meaning that the course includes questions with feedback as to why the right answer is correct and why the wrong answers are incorrect.
ClientWhys has already been approved as an education provider and offers several approved courses, including a 24-hour bundle that enables you to meet your annual tax and ethics CE requirement. If you are located in California, ClientWhys also provides a 24-hour CE package that includes 16 hours of live education and 8 hours of self-study (including ethics) at 11 locations in California. Call customer service for further details.
- California Registered Tax Preparer -- CTEC now requires you to meet tax return preparer requirements (see tax return preparer above) alongside successfully completing a 5-hour CTEC approved course on California taxes in order to renew your CTEC registration in October of 2012. Caution: In order for 15-hour federal required courses to qualify for both IRS and CTEC credit, a provider must be approved by both the IRS and CTEC, and the 15 hours of Federal studies must be IRS-approved and have a unique IRS number assigned to them in addition to a CTEC number. The 5-hour California tax course needs only to be approved by CTEC and to have a CTEC number.
Caution -- As previously mentioned, the IRS no longer allows IRS publications to serve as course material, and all self-study courses must be interactive. Keep in mind that the IRS sprung these requirements on the provider community in mid-December and that not all providers have thus addressed these new requirements. Luckily, ClientWhys has always employed the interactive standard, since most of our courses also meet NASBA standards for CPAs. While we used to offer a Publication 17 course that included substantial Federal and California supplemental material, in light of the ban on courses using IRS Publications as course material, we have discontinued our Kruesmark course line and replaced it with 2012 compliant courses.
Both the IRS and CTEC have approved ClientWhys as an education provider. The IRS has approved our CTEC courses; thus, upon completion, you get credit for both the IRS and CTEC. In addition, we have developed a 5-hour California course called California Differences that meets the 2012 CTEC 5-hour requirement. These courses, the 10-hour Federal Tax Subjects, 3-Hour Federal Update, 2-Hour Ethics, and 5-Hour California Differences, are available in a special bundle that meets CTEC and IRS annual requirements.
ClientWhys also conducts instructor lead 2-day seminars in the fall at 11 locations in California. The seminar is packaged with additional self-study courses that provide you with your complete IRS and CTEC annual requirements. Call customer service for further details.
- Certified Public Accountants — CPAs and Attorneys have no IRS mandated tax CE. They are state licensed, and their CE requirements are set by their state licensing authority. In order to renew their PTIN each year, they only need to maintain their state licenses in good standing. However, ClientWhys is an approved NASBA provider and can provide CPAs with valuable tax education by means of both our interactive self-study courses and our live seminar offerings. Please visit www.clientwhyscpe.com for a list of courses and seminars.
Competency Examination -- Everyone except attorneys, CPAs, and EAs must pass the IRS competency examination prior to the end of 2013. In order to obtain your PTIN for the 2014 year, you must have passed the competency examination. The IRS has indicated that this test is currently only a one-time examination. Attorneys, CPAs, and EAs are exempt from this exam, as they have already had to pass more rigorous competency tests in order to obtain their licenses.
The examination is very basic, and competent, experienced tax practitioners should find it quite easy to pass. The ideal time to take the examination is at the conclusion of the tax season, in April or May of 2012, when you are fresh from the tax season and your skills are at their peak. You will be provided with Pub 17, a calculator, scratch paper, and other material in order to take the exam. The IRS website provides details about the test and ways to prepare for it. Prometric, the company that administers the examination also offers a brochure with valuable information.
Ready to begin your 2012 education? We are ready to serve your needs with valuable compliant continuing education. Visit our CE website or call customer service at 800-442-2477 Ext 1 for additional information.
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.