IRS may regulate tax preparers

http://www.newsobserver.com/nation_world/story/1556193.html

The Associated Press
WASHINGTON -- The IRS wants to start regulating paid tax preparers used by more than half the nation's taxpayers in an effort to reduce fraud and errors.

New rules could require education and training as well as licensing for people who get paid to prepare returns, IRS Commissioner Doug Shulman said Thursday.

"In most states, anyone can charge to prepare tax returns regardless of training, education, experience, skill, licensing or registration," Shulman told reporters. "Virtually anyone can set up a tax return business."

Shulman said that most tax preparers provide quality work, but that some are poorly trained or unscrupulous. The IRS, however, can't say how many fall into either group because the agency doesn't track the number of complaints filed against tax preparers or their outcomes, according to a report issued in February by the Treasury Inspector General for Tax Administration.

The IRS doesn't even know how many individuals or companies prepare returns for taxpayers, Shulman acknowledged.

From 2006 through 2008, the IRS initiated more than 600 investigations of fraud among tax preparers. During that time, 356 tax preparers were convicted.

In March, a tax preparer in Clayton, N.C., was accused of taking out tax refund anticipation loans in the name of her customers and using the money herself.