IRS Advisory Committee Recommends Regulation of Noncredentialed Tax Preparers and Increased Funding for IRS and National Taxpayer Advocate

The Internal Revenue Service Electronic Tax Administration Advisory Committee is calling on Congress to take action to regulate noncredentialed tax preparers and increase funding for the IRS and the National Taxpayer Advocate. In their annual report released on Wednesday, the committee outlined these recommendations, along with several others aimed at improving tax administration and protecting taxpayers.

One of the key recommendations is the regulation of noncredentialed tax preparers, who currently do not have any federal education, certification, or training requirements. This lack of regulation opens the door for unqualified individuals to provide inaccurate and low-quality tax advice to unsuspecting taxpayers. The committee is urging Congress to authorize the IRS to implement a program that would train and educate noncredentialed preparers, similar to existing programs like the Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs.

Additionally, the committee recommended enabling access to taxpayer information through an application programming interface to enhance security and efficiency in the taxpayer experience. They also suggested removing barriers to electronic filing by developing a more secure alternative to the current Self-Select PIN process. The committee emphasized the importance of promoting greater information sharing between the IRS, states, and industry partners to improve data accuracy and integrity.

IRS Commissioner Danny Werfel expressed his support for the committee’s recommendations, stating that they serve as trusted advisors on key issues related to tax administration and taxpayers. The IRS leadership team will carefully review the recommendations outlined in the report to continue improving tax administration and protecting taxpayers.