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    Tax preparer issue

    I do not file taxes for other people...I prepare them and hand them to the client. Will I have to start efiling. Will I have to have each client sign a 8948 ??

    #2
    Tax Preparer Definition

    If you are paid for the tax return work-you are a tax preparer and you are:
    a) Required to sign the tax return
    b) Required to e-file

    Comment


      #3
      And More

      Being a paid preparer, you're ALSO obligated to obtain a Preparer Tax Identification Number
      (PTIN).
      Since you haven't obtained one previously - IRS is now shut down until 1st week of January for NEW PTIN applications.
      Uncle Sam, CPA, EA. ARA, NTPI Fellow

      Comment


        #4
        So basically you prepare paper returns for clients (people) and they pay you for them.Is that correct? Do you sign the returns?
        To be on this board you must have purchased a Tax Book. That would indicate to me that you probably want to prepare correct returns. Is that correct?

        You are one of the people that IRS is trying to locate and they want you to register with them, get a PTIN and make sure you get education each year so that you prepare accurate returns.

        At this stage of the game, you have to comply with IRS rules and become a registered tax return preparer or you have to QUIT preparing tax returns for these people and send them to someone with the proper credentials.

        Just my opinion.

        Linda, EA

        Comment


          #5
          Preparer

          Originally posted by Izzy44 View Post
          I do not file taxes for other people...I prepare them and hand them to the client. Will I have to start efiling. Will I have to have each client sign a 8948 ??
          Form 8948 must be attached to each return, however, I do not see a Taxpayer's Signature requirement. As a preparer you can file for a waiver of efiled returns, see
          From IRS website http://www.irs.gov/taxpros/providers...223832,00.html Filing more than 100 returns in 2011, or more than 11 in 2012 must e-file.

          As noted in prior post, you will as a preparer need a PTIN # to prepare and file any returns, along with any required RTRP tests and certification, or CPE.

          Compliance with Licensing, CPE, Certification and PTIN is a must for 2012 filing 2011 Tax Returns - (Correction for filing 2012 Tax Returns)

          Sandy
          Last edited by S T; 12-28-2011, 11:31 PM.

          Comment


            #6
            Originally posted by S T View Post
            Form 8948 must be attached to each return, however, I do not see a Taxpayer's Signature requirement. As a preparer you can file for a waiver of efiled returns, see
            From IRS website http://www.irs.gov/taxpros/providers...223832,00.html Filing more than 100 returns in 2011, or more than 11 in 2012 must e-file.
            There is no requirement for a taxpayer's signature on the 8948. However, there is a documentation requirement on the preparer if box 1 is checked, which requires that the preparer get the taxpayer's signature on a form kept by the preparer, not attached to the return. See the instructions, and then read the various references given there.

            Compliance with Licensing, CPE, Certification and PTIN is a must for 2012 filing 2011 Tax Returns.
            There's no CPE requirement for filing 2011 returns during the traditional 2012 filing season. I'm not sure what you mean by licensing or certification - all that's needed is a PTIN.

            Comment


              #7
              Gary as usual you are correct,
              Trying to keep up with all of the new regulations on Licensing, etc, so for the RTRP effective 2012 tax year filings (not 2011)

              We always have one foot in one year and another foot in the coming year

              Thanks for the correction,

              Sandy
              Last edited by S T; 12-28-2011, 10:26 PM.

              Comment


                #8
                preparer issues

                I should have been clearer in my first post. I have had a PTIN for fifteen years, sign my returns as a preparer, and take at least fifteen hours of CPE studies per year to keep up to date. IRS states that if you file taxes for your clients (over 10) you must efile. I do not file my returns. My client base does not want to efile, do they need to sign a 8948?

                Comment


                  #9
                  Originally posted by Izzy44 View Post
                  I should have been clearer in my first post. I have had a PTIN for fifteen years, sign my returns as a preparer, and take at least fifteen hours of CPE studies per year to keep up to date. IRS states that if you file taxes for your clients (over 10) you must efile. I do not file my returns. My client base does not want to efile, do they need to sign a 8948?
                  They need to sign something to provide you with documentation that it was their choice, but the 8948 does not qualify as that something. (It even says that it doesn't qualify in the instructions.)

                  People are getting confused because there are literally two different pieces of paper involved. The first, the Form 8948, must be attached to (almost) any paper return that is being submitted if that return was prepared by a "specified" preparer (most of us) and is a "covered" return (e.g. any 1040-series, plus many others). The 8948 has several check boxes, only one of which is "taxpayer chose to file this return on paper." If you qualify for one of the other reasons, then this might be the only piece of paper you need for this return (e.g. can't e-file because of multiple IRS rejects).

                  The second piece of paper is not an official IRS form although they do specify minimal contents, it must be signed by the taxpayer, it doesn't get attached to the return, and it must be kept by the preparer as proof of the taxpayer's choice. The instructions for the 8948 identify the revenue procedure with the details, which you can find with an internet search. Since it's likely to change, I won't identify it here; get the most recent version from the IRS site.

                  To summarize:
                  • Form 8948 is not signed, but is attached to the return sent to the IRS.
                  • The taxpayer's confirmation is signed by the taxpayer, is not attached to the return, and must be kept by the preparer.


                  Addendum: Adding to the confusion are the IRS's logical machinations. They impose the e-file requirement only on returns filed by a preparer, making it clear that if the taxpayer does the mailing, then the e-file requirement doesn't apply. That could lead one to believe that if you give the paper return to the client, you're home free. But you're not, because the aforementioned revenue procedures require you to keep documented proof, including the client's handwritten signature, that the client made the choice.

                  Comment


                    #10
                    IRS is working toward having all returns electronically filed. They are getting closer to that goal.
                    Perhaps if the clients understood the advantages of efiling, they might be more receptive to it.
                    Although in your case, you really don't want them to efile.

                    Linda, EA

                    Comment


                      #11
                      Originally posted by oceanlovin'ea View Post
                      IRS is working toward having all returns electronically filed.
                      ...
                      Perhaps if the clients understood the advantages of efiling, they might be more receptive to it.
                      ...
                      Linda, EA
                      As a paid preparer, I certainly do go with the program in terms of e-filing my clients' returns and in terms of persuading clients that e-filing is better for them.

                      On the other hand, for my own tax return, I do not perceive much of any benefit to me. If I put the correct numbers onto pieces of paper, I can mail it in and let the IRS worry about data entry of the information. Although I have overpaid this year, I usually plan to have a small balance, but no estimated tax penalty, due. Maybe it's a little better to have the IRS computers check through what I submit a little faster.

                      EA in Calif.

                      Comment


                        #12
                        advantage to efiling

                        When I found out that the people that process the mailed in tax returns are just data entry people with no special training in the tax forms and that they process approximately 50 to 70 returns per hour, I decided I didn't want them messing with my figures. Especially hand written returns, they aren't going to look twice to see what a number is, they are just flying along.
                        When I efile, I know IRS is getting exactly what I put on the return.

                        Linda, EA

                        Comment


                          #13
                          Originally posted by Izzy44 View Post
                          I should have been clearer in my first post. I have had a PTIN for fifteen years, sign my returns as a preparer, and take at least fifteen hours of CPE studies per year to keep up to date. IRS states that if you file taxes for your clients (over 10) you must efile. I do not file my returns. My client base does not want to efile, do they need to sign a 8948?
                          It's easy - simply tell your clients that you are required to e-file. Then just e-file.

                          I would caution you on wholesale use of Form 8948. It is designed for the occassional client who might object. §10.51 of C230 now defines willful failure to e-file returns as disreputable conduct. Remember - all paid preparers are now subject to discipline. Ask yourself - which is worse - an irritated client or an irritated OPR?

                          You might also want to read TD 9518 for a thorough discussion of the e-file mandate and the possible exclusions.

                          Comment


                            #14
                            Originally posted by OtisMozzetti View Post
                            ...I can mail it in and let the IRS worry about data entry of the information.
                            EA in Calif.
                            TheIRS doesn't worry about the data entry by their employees, but I sure do! It will always come back to the client that you, the preparer screwed up, not theIRS.

                            I don't explain e-filing to my clients, it's mandatory not their choice, or they can go somewhere else to get the return prepared.
                            "A man that holds a cat by the tail learns something he can learn no other way." - Mark Twain

                            Comment


                              #15
                              Originally posted by Izzy44 View Post
                              I should have been clearer in my first post. I have had a PTIN for fifteen years, sign my returns as a preparer, and take at least fifteen hours of CPE studies per year to keep up to date. IRS states that if you file taxes for your clients (over 10) you must efile. I do not file my returns. My client base does not want to efile, do they need to sign a 8948?
                              Remember when we use to fill out tax returns by hand, prior to the computer? Then when personal computers became affordable, some of us bought a computer and tried to use tax software to prepare the returns. Others laughed at us and claimed they could do tax returns faster and easier by hand.

                              You don’t hear anyone making that claim anymore. The computer has long since proven its value over hand prepared returns.

                              The same is true for e-filing. Try it and I guarantee you will like it.

                              Comment

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