IRS Unveils Filing Season Program for Tax Return Preparers, Answers Frequently Asked Questions
FS-2014-8, June 2014
What is the Annual Filing Season Program for return preparers?
The Annual Filing Season Program is a voluntary program designed to encourage tax return preparers to participate in continuing education (CE) courses.
Unenrolled return preparers can elect to voluntarily take continuing education each year in preparation for filing season and receive an Annual Filing Season Program – Record of Completion.
The program is important for a number of reasons. It encourages unregulated return preparers who don’t have to meet continuing professional education requirements to stay up to date on tax laws and changes. It helps lessen the risk to taxpayers from preparers who have no education in federal tax law or filing requirements. And it allows preparers without professional credentials to stand out from the competition by giving them a recognizable record of completion that they can show to their clients.
Preparers who complete the AFSP will also be included in a new public directory that will be added to IRS.gov by January 2015 for taxpayers to use in searching for qualified tax return preparers. The Directory of Federal Tax Return Preparers with Credentials and Select Qualifications will only include attorneys, certified public accountants (CPAs), enrolled agents, enrolled retirement plan agents (ERPAs), enrolled actuaries and individuals who have received an Annual Filing Season Program – Record of Completion.
Who can participate in the Annual Filing Season Program?
The Annual Filing Season Program is intended to recognize and encourage the voluntary efforts of unenrolled tax return preparers to increase their knowledge and improve their filing season competency through continuing education. The program is not directed at or necessary for credentialed preparers such as attorneys, CPAs, enrolled agents, enrolled retirement plan agents or enrolled actuaries. They are already in possession of higher level qualifications.
What are the requirements for obtaining an Annual Filing Season Program – Record of Completion for 2015?
In general, to obtain an Annual Filing Season Program – Record of Completion a return preparer must obtain 18 hours of continuing education from an IRS-approved CE Provider. The hours must include a 6 credit hour Annual Federal Tax Refresher (AFTR) course that covers filing season issues and tax law updates. The AFTR course must include a knowledge-based comprehension test administered at the conclusion of the course by the CE Provider. Unenrolled preparers who have passed recognized state or national tests qualify for an exemption from the AFTR course. See below for additional information on course exemptions.
The amount of CE required to obtain the Annual Filing Season Program – Record of Completion is prorated for Filing Season 2015. A total of 11 hours must be obtained for Filing Season 2015, including the 6 hour AFTR course, 3 hours of federal tax law topics and 2 hours of ethics.
Does the IRS administer the comprehension test given at the end of the Annual Federal Tax Refresher Course?
No, the IRS does not administer the comprehension test. IRS-approved Continuing Education Providers offer the Annual Federal Tax Refresher course and are responsible for the development and administration of the comprehension test associated with the AFTR course. The IRS does provide a course outline and test parameters which must be followed by providers.
Is there a fee to obtain an Annual Filing Season Program – Record of Completion?
Just as for all CE courses, each IRS-approved CE provider will determine the course participant fee.
What does the AFTR course cover?
The Annual Federal Tax Refresher course will cover tax law topics across three domains: New Tax Law/Recent Updates, General Review and Ethics, Practices and Procedures. The IRS will publish course content guidelines annually for IRS-approved CE Providers. It is the responsibility of CE Providers to ensure all course content is covered in the Annual Federal Tax Refresher course.
What does the AFTR test cover? What is the format and how long is it?
The AFTR Course comprehension test will include all tax law topics covered in the AFTR course. The exam will consist of a minimum of 100 questions made up of multiple choice and True/False style questions. Participants will have a maximum of 3 hours to complete the exam. Refer to the test parameters published by the IRS for more information.
What if I take the course but do not pass the test?
The course has not been satisfactorily completed until the comprehension test is passed. CE Providers will not provide course completion information to the IRS until you pass the ATFR exam. Your provider’s policy will determine whether you must re-take the course or just the course exam.
Do I need to notify the IRS once I have completed the Annual Filing Season Program’s Continuing Education requirements?
No, following the completion of all Continuing Education requirements, return preparers will receive a notice of their potential eligibility for the program. You will be asked to log into your PTIN account for additional information on completing the process. Among the final steps will be a required consent to adhere to specific practice obligations outlined in Subpart B and section 10.51 of Treasury Department Circular No. 230. Following successful completion of these steps, you will be issued an Annual Filing Season Program - Record of Completion.
Please note that it may take up to four weeks following the completion of all requirements for return preparers to receive a Record of Completion and be placed on the Directory of Federal Tax Return Preparers with Credentials and Select Qualifications. Additionally, you will not be issued a Record of Completion until your PTIN is renewed for the upcoming tax year.
How do I find a provider offering the AFTR course?
The IRS publishes a complete listing of all IRS-approved Continuing Education Providers. Refer to the Annual Federal Tax Refresher column under Program Categories Offered for providers who offer the AFTR course.
Who is exempt from taking the AFTR course?
Some unenrolled preparers are exempt from the AFTR course requirement because of their completion of other recognized state or national competency tests. These exempt groups are still required to meet other program requirements, including 15 CE credits (10 Federal Tax Law, 3 Federal Tax Law Updates, and 2 Ethics).
Return preparers who can obtain the AFTR – Record of Completion without taking the AFTR course are:
- Anyone who passed the Registered Tax Return Preparer test administered by the IRS between November 2011 and January 2013.
- Established state-based return preparer program participants currently with testing requirements: Return preparers who are active registrants of the Oregon Board of Tax Practitioners, California Tax Education Council, and/or Maryland State Board of Individual Tax Preparers.
- SEE Part I Test-Passers: Tax practitioners who have passed the Special Enrollment Exam Part I within the past two years as of the first day of the upcoming filing season.
- VITA volunteers: Quality reviewers and instructors with active PTINs.
- Other accredited tax-focused credential-holders: The Accreditation Council for Accountancy and Taxation’s Accredited Business Accountant/Advisor (ABA) and Accredited Tax Preparer (ATP) programs.
How do I obtain an Annual Filing Season Program – Record of Completion if I am exempt from the AFTR course?
Those who are exempted from the AFTR course must meet the alternative requirements (15 hours of IRS-approved CE, consent to Circular 230 practice requirements and a valid PTIN for the upcoming filing season) in order to receive an AFSP Record of Completion. Once all requirements are met, the exempted return preparer will automatically be issued a Record of Completion.
A return preparer will not be required to notify the IRS of an exemption. The IRS is obtaining information about exemptions directly from the testing source (e.g. Oregon Board of Tax Practitioners).
How and when will I get my Record of Completion?
After PTIN renewal season begins in October 2014, a Record of Completion will be generated to a return preparer once all requirements, including renewal of their PTIN for 2015, have been met.
Tax return preparers with online PTIN accounts will receive an email from TaxPro_PTIN@irs.gov with instructions on how to complete the application process and receive their certificates in their online secure mailbox.
Tax return preparers without an online PTIN account will receive a letter with instructions for completing the application process and obtaining their certificates.
Is there a deadline for taking the AFTR course? For obtaining a Record of Completion?
To be eligible for an AFSP – Record of Completion, a return preparer must complete and pass the AFTR course and obtain their other CE by December 31 prior to the start of the tax season. As AFTR courses are offered by CE providers, return preparers are subject to the schedule of courses offered by these providers.
In no circumstance will the AFSP – Record of Completion be issued before a return preparer has registered or renewed their PTIN for the upcoming year.
What is the Directory of Federal Tax Return Preparers with Credentials and Select Qualifications? When will it be available?
By January 2015, the IRS will launch a public directory on the IRS website of tax return preparers with credentials and select qualifications. This will be a searchable, sortable listing so that taxpayers can find a return preparer that carries their preferred credentials or qualification(s).
Who will be included in the Directory and what information will be shown?
The Directory will include the name, city, state and zip code of all attorneys, CPAs, enrolled agents, enrolled retirement plan agents, enrolled actuaries and AFSP participants who have obtained a Record of Completion and who have a valid PTIN.
Are credentialed preparers precluded from participating in the AFSP?
No, as indicated above, this program is not designed, directed or intended for credentialed preparers who already possess a much higher level of qualification. However, if a credentialed preparer seeks to participate in the program, he or she would be required to meet the same requirements as those preparers in the exempt category.
Will I still be able to represent clients before the IRS if I don’t participate in the Annual Filing Season Program?
Yes, as a PTIN holder you will continue to have limited representation rights before limited offices of the IRS with respect to clients whose return you prepared and signed for calendar year 2015. However, beginning in 2016, only AFSP participants who obtain a Record of Completion will have those limited representation rights before the IRS for clients whose returns they prepared and signed. PTIN holders without an AFSP - Record of Completion or without other professional credentials will not be able to represent clients before the IRS in any matters.
Attorneys, CPAs and enrolled agents will continue to have unlimited representation rights and can represent clients before any office of the IRS.
Are preparers who participate in the Annual Filing Season Program subject to Circular 230 regulations?
To participate in the AFSP, unenrolled preparers must agree to adhere to the practice requirements for tax practitioners outlined in Subpart B and section 10.51 of Treasury Department Circular No. 230.
Any return preparer who represents a taxpayer before the IRS is subject to Circular 230.
Why is the IRS launching this voluntary program? Why not wait to see if Congress passes legislation regarding return preparer oversight?
The IRS believes in a mandatory competency standard for federal tax return preparers. To this end, legislation continues to be our priority. But until legislation is enacted, we still have a responsibility to taxpayers and to our tax system to keep moving forward with our efforts to improve service to taxpayers.
In the interim, this new program recognizes the efforts of unenrolled return preparers to improve their professional competency through continuing education. Anyone with a PTIN can prepare a federal tax return, but for those preparers with a PTIN who also work to ready themselves for the filing season through educational efforts, the IRS will issue them a recognizable record of completion that they can show to their clients.
Do return preparers have to participate in the Annual Filing Season Program?
No, it’s a voluntary program. Anyone with a preparer tax identification number (PTIN) can prepare tax returns for compensation, but continuing education is encouraged for all tax return preparers.
- IR-2014-75, New IRS Filing Season Program Unveiled for Tax Return Preparers
- Revenue Procedure 2014-42