1. 1 Registered Tax Return Preparers Frequently Asked Questions A presentation of the North Carolina Society of Enrolled Agents

2. 2 Effective January 1, 2011, All compensated individuals (paid preparers) Who prepare all or substantially all of a federal tax return or claim for refund Must obtain or renew a Preparer Tax Identification Number (PTIN) prior to filing any return There are a few exceptions (e.g. VITA, employee of taxpayer) Are tax preparers required to be licensed or registered? North Carolina Society of Enrolled Agents

3. 3 What are the different kinds of tax professionals? TitleDesig. License issued by Representation ability Registered Tax Return Preparer RTRPIRSLimited Enrolled Agent EA US Treasury Full Certified Public Accountant CPAStateFull Attorney -StateFull North Carolina Society of Enrolled Agents

4. 4 Apply for or renew a PTIN –Preparers may also be required to e-file Pass a proficiency exam Complete Continuing Education Credits Note: Enrolled Agents, CPAs and Attorneys have separate proficiency exam and continuing education requirements What are the new registration requirements for tax preparers? North Carolina Society of Enrolled Agents

5. 5 Go to http://www.irs.gov/taxpros/ http://www.irs.gov/taxpros/ Click on SIGN UP NOW Create an account Complete the application Pay a $64.25 fee How do I apply for or renew a PTIN? North Carolina Society of Enrolled Agents

6. 6 The requirement will be phased in over two years. As a result of the new rules, preparers will be required to start using IRS e-file beginning: January 1, 2011—100 or more federal individual or trust tax returns during the year; or January 1, 2012—11 or more federal individual or trust tax returns during the year. Must register – registration may take up to 45 days. What is the e-file requirement? North Carolina Society of Enrolled Agents

7. 7 Exam to demonstrate competency to prepare federal tax returns Scheduled to begin mid-2011 Scheduled to begin mid-2011 Have until Jan 2013 to pass exam if PTIN obtained before exam is available Once exam available, must pass before: –Getting PTIN –Preparing federal tax returns What is the proficiency exam requirement? North Carolina Society of Enrolled Agents

8. 8 Annual continuing education requirement Anticipated 15 CPE hours in tax Anticipated 15 CPE hours in tax –Including ethics Details are still being worked out What is the continuing education requirement? North Carolina Society of Enrolled Agents

9. 9 RTRPs are authorized to: Prepare tax returns for compensation Represent taxpayers in Examination with respect to returns the RTRP prepared What are the limitations on registered tax return preparers to represent taxpayers? North Carolina Society of Enrolled Agents

10. 10 An individual licensed by the U.S. Treasury To represent taxpayers before the Internal Revenue Service. Enrollment dates back to 1884,when Congress acted to regulate persons who represented citizens in their dealings with the Treasury Department after questionable claims had been presented for Civil War losses. What is an Enrolled Agent? North Carolina Society of Enrolled Agents

11. 11 Enrolled Agents specialize in taxation. Throughout the year, they advise, represent and prepare returns for individuals, partnerships, corporations, estates and trusts – any entity with tax-reporting requirements. What exactly do Enrolled Agents do? North Carolina Society of Enrolled Agents

12. 12 Examination Examination Collection Collection Appeals Appeals Common opportunities to represent a taxpayer North Carolina Society of Enrolled Agents

13. 13 Enrolled Agents have the authority to prepare any type of tax return and may represent any taxpayer at all levels of the IRS (except tax court), whether or not they prepared the return. Registered Tax Return Preparers may prepare tax returns and may, on a limited basis, represent taxpayers in examinations of tax returns they prepared. How do Enrolled Agents differ from registered tax return preparers? North Carolina Society of Enrolled Agents

14. 14 Enrolled Agents specialize in taxation and are specifically licensed at the federal level to represent taxpayers. CPAs and attorneys are licensed at the state level to practice accountancy or law and many specialize in areas other than taxation. They can obtain the same representation authority granted to Enrolled Agents by filing their credentials with the IRS. How do Enrolled Agents differ from CPAs and attorneys? North Carolina Society of Enrolled Agents

15. 15 Have other questions? Visit us online at www.ncseaonline.org or the National Association of Enrolled Agents at www.naea.org You can also contact any Board Member of the North Carolina Society of Enrolled Agents listed on the website at www.ncseaonline.org North Carolina Society of Enrolled Agents