May 19, 2013

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Common Tax Myths and the True Facts about Them

November 26, 2012 By

Taxpayers are likely to cling to any myth that promising and likely to lower their tax bills. In fact, many are quick to believe whatever they are told by friends, family, or even what they read on the web. The only authentic source of information on taxes is the tax law, which is best understood by the IRS and tax professionals. Explained below are some tax myths and the truth about them:

To Claim Tax Deductions, You Must Itemize

Just because most common tax deductions, like home mortgages and medical costs, require the taxpayer to file Schedule A or itemize to claim, doesn’t mean all other deductions must be itemized to be claimed. There are many other “above the line” deductions on the Adjusted Gross Income section of Form 1040 that don’t necessary require any itemization. These include alimony, moving costs, and tuition fees, amongst others.

Payments Received Below $600 don’t Have to be claimed

It is one of the most common myth and many taxpayers are misled into believing that you cannot claim received payments that is below $600. The truth is that there is a $600 threshold that payers are required to report on Form 1099. This means that you have to report the amount whether the 1099 is issued or not.

Anyone with Kids is Considered a Head of Household

The way individuals define Head of Household differs from the IRS’s definition. According to Uncle Sam, only unmarried individuals who provide for dependents can file as Heads of Households. You therefore, have to be divorced, unmarried or single at the end of the tax year and have paid over 50% of the home maintenance. Visit the IRS website to find out instances when you are considered as unmarried.

If You Evade Filing Taxes for 3, 5, or 7 Years, You are Let off the Hook by the IRS

The 3 year IRS statute of limitation that applies to most taxpayers has a number of restrictions that have to be understood. The statute in reality, never expires if you fail to file your returns. This means that the IRS will still hunt you down whenever they find sufficient reasons to.

Your Tax Professional is to Blame for Your Tax Return Flaws

Taxpayers are not excused if the tax returns prepared by tax pros contain mistakes. The IRS expects all taxpayers to read and understand tax returns before sending them. You take personal responsibility and guarantee accuracy the moment you sign against the dotted lines.
Other common myths include beliefs that correcting tax return mistakes may lead to an audit. Some believe that taxpayers are free to sell their houses tax-free after hitting 55 and minors are exempted from paying and filing tax returns. These myths are misleading and you have to be informed to avoid any troubles with the IRS.

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Cooperate with the Tax Preparer for Successful Tax Filing

November 19, 2012 By

More than 60% of tax returns are prepared with the assistance of tax preparers. Despite the sufficient time allowed for the preparation and filing of taxes, procrastination affects many taxpayers who only take filing seriously when the deadline is drawing too close for comfort. As a result, they turn to tax preparers for assistance, expecting a miracle. It must however, be stressed that successful tax filing calls for corporation from taxpayers, who should be available and able to present required documents whenever they are needed. Honesty is essential, as it is the best way to evade trouble with the IRS. Many tax preparers are frustrated by taxpayers for various reasons.

One of the most frustrating and bothersome issue tax preparers have reported involves the busy taxpayer who prefers to work on taxes on April 15th. It really doesn’t matter how busy you are, tax preparers are even busier during the tax filing season and the best you can do to have your return prepared well is to create enough time to resolve your tax problems. Another frustration emanates from taxpayer’s unnecessary questioning, like a change in the amount owed. It is simple, the IRS tax code is constantly changed, and some credits expire while new ones are introduced, amongst others. If you need any clarification, just ask modestly and it will be clarified, or you can call the IRS on your own.

It is unacceptable to ask a tax preparer to lie when filing tax returns. This will not only hurt his or her career if discovered by the IRS, but could also land you in trouble with the IRS. If there are some changes in your life like a divorce, marriage, or kids, you should acquire all necessary information on how that will affect your taxes long before the filing season. It is meaningless to burn out a whole day clarifying obvious issues. As much as a tax preparer has to answer all questions effectively, it is not fair to use up a large amount of time clarifying matters that you can simply find on the IRS website. Save time, especially if the deadline is drawing closer.

Tax preparation is about records and documental evidences of your income and expenditures. If you don’t have the receipts, try to find them from your vendors, banks, and other sources. It is very possible to understate deductions if you don’t have crucial tax documents. The IRS may demand for them anyway, and if you cannot find them, you better be content with standard deductions and remember to keep them the following year.

There is no acceptable excuse to evade paying the tax preparer, regardless of how steep your taxes are. Finally, don’t pretend to know everything about taxes (when in fact, you don’t), and try to guide the preparer. Letting the preparer do his or her job without harassment is the quickest and easiest way to get one’s tax returns done right.

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5 Characteristics of Lousy Tax Preparers

July 24, 2012 By

Taxes are difficult, and it is the complexity that propels many taxpayers to seek specialized assistance from tax preparers. However, since the business is lucrative enough, the chances of unluckily landing and hiring a lousy and unethical tax preparer are high; this can easily raise the risk you facing an ugly tax audit later.         

With over 60% of overall tax returns preparations being handled by tax preparers, you must be very careful when hiring them and watch out for danger signs of a phony “tax pro.” There is a lot of money involved with taxes and very stringent tax laws that the IRS officials would like to head straight to the courts and have you prosecuted to not only teach you a bitter lesson, but also have you serve as an example to others who might be toying around with the idea of mutilating their taxes.

You just cannot afford mistakes like having excess exemptions, overlooking and failing to claim legitimate tax credits, and failing to note tax deductions which can save you lots of money. These mistakes might not be committed by you, but you take full responsibility since you are the one that signs all the tax forms. To ensure that you evade the raw tax preparation deals, you need to stay alert and watch out for the following key indicators of a not-so-competent tax preparer. Always, hire a licensed individual, not one who promises you heaven but has not ability to even offer hell.

1. Promises Huge Refunds: Everyone wants some refunds; that is a fact. However, as a marketing strategy, the fraudsters will passionately and assuredly promise you massive refunds even before peeking at your tax documents. These breed advertise and promise the impossible, don’t fall for the tempting offers. They might play around with the numbers on your return to come up with huge payouts, but think about the IRS reviews later and consequences.

2. Lack of Proper Credentials: Is your tax preparer competent and can that be proven? The IRS assigns every qualified tax preparer a Preparer Tax Identification Numbers (PTINs). You are likely courting problems with the taxman if your preparer doesn’t have the PTINs, demand to see it.

3. Refunds Not Deposited into Your Bank Account: Your refund is your money, and must be deposited into your account. Any other destination that doesn’t have your name on it as might be suggested by your preparer is a red flag!

4. Wants a Percentage of your Refunds as Fee: Depending on the scope and size of your tax return, decent tax preparers charge a flat fee for all services, and not some percentage of your returns. Those who prefer to go the percentage way will do anything to pump up the refund by even mishandling of financial information.

5. Review the Specialist: Before you let some stranger manage your documents, take some time to check out with the local Better Business Bureau. Avoid anyone with a tainted record, however promising he or she might be.

You can steer clear of trouble by avoiding the incompetent tax preparer. There are so many decent tax preparers out there, don’t be fall for the fake ones.

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7 Tips to Selecting the Ideal Tax Preparer

April 13, 2012 By

Getting the right tax preparer may keep you from being audited by the IRS, save you on taxes payable by claiming the right deductions and credit, provide a more time and cost efficient service, among many other benefits. You therefore, need to carefully select the tax preparer to handle your taxes. Below are 7 tips that you can use to review a tax preparer before taking up his or her services:

1. Licensed by the IRS as a Tax Preparer

The first check for any tax preparer is to confirm that he or she is licensed by the IRS. In 2011, the IRS introduced new regulations for tax preparers. A tax preparer is now required to obtain a Preparer Tax Identification Number (PTIN) and an annual preparer license from the IRS before practicing. Preparers who are not Enrolled Agents, attorneys or CPAs will be required to sit and pass a test and undertake annual continuous training to keep their license. Therefore, ensure that your preparer is licensed and has a PTIN.

2. Professional Qualifications of Preparer

Besides the PTIN, it may also be advisable to seek for further professional qualifications. Depending on the nature of your returns, you may require an accountant or even an attorney to handle your returns. You should therefore check for such professions. You should also review the preparer with various professional bodies that he or she is a member of. You can use services such as Better Business Bureau to verify integrity of the consultant.

3. Costs of Services

You should also review the fees charged by the preparer. Different methods are used to charge the consultancy fees. Some preparers charge an hourly rate while others charge based on complexity and number of forms being filed. According to a survey done in 2010, the average paid by those interviewed was $233 for a State and IRS return for taxpayers who were itemizing and $128 for state and Federal returns for taxpayers who were using standard deduction. Therefore, ensure that you are not overcharged. You should also stay away from preparers who use unprofessional ways of charging fees such as fees structure based on the amount of refund that the preparer is able to get you.

4. Scope of Work Handled by Preparer

Preparers handle different aspects of tax and you need to ensure that a tax preparer provides the services that you require. Some tax preparers handle only IRS taxes while others handle Federal, State and Local taxes. Some tax preparers only handle certain types of taxpayers while others will not handle issues such as late taxes, installment tax requests, or tax representation. You therefore, need to know the scope of work of a given tax preparer before committing.

5. Years of Experience

The years of experience are also an important factor to consider for tax preparers. Tax is a complex subject and there are many different situations and matters that may arise. For this reason, experience plays an important role in knowing how to handle complex tax issues and how to deal with the IRS. It is therefore, advisable to seek a preparer with considerable years of experience in the business.

6. Support in Case of an IRS Audit

Some tax preparers and tax software firms provide an undertaking to represent you or provide support free of charge should the IRS want to audit you for returns that the preparer filed or that you filed using the tax software. Other tax service providers do not give such an undertaking. Therefore, you need to consider such terms before signing up for the preparer services.

7. Tax Support beyond Filing

You also need to find out if the preparer is available for any advice or tax support during the year. Some preparers are only available during peak tax season just for the services of filing returns. They are not available for any further tax consultancy such as representation, or even tax advice.

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Looking for a Tax Preparer? Here is How to Go About It.

April 10, 2012 By

For most taxpayers, preparing taxes can be quite tedious and technical. For this reason, over 70% of taxpayers prefer using a tax preparer as opposed to filing their own returns. If you are one of these taxpayers who would rather outsource this process of tax preparation, then the tips below may help you identify the ideal preparer to handle your taxes.

Examine Your Needs

Different people will have different needs depending on one’s specific tax situation. For most people, they require a tax preparer to file the annual returns. However, for small business owners and self-employed, you may require a tax preparer with an accounting background so as to help in both preparing your accounting records and filing your returns. You may therefore, need the preparer throughout the year. If you have more specific needs such as if you have outstanding taxes, are earmarked for an audit, are unable to pay your taxes or if you have unreported past taxes, you may require a tax consultant who has more knowledge with these specific issues.

Sourcing for the Preparers

Once you have determined your specific tax need and the professional who is fit to handle your problem, then you can proceed with your search for the preparer. You can get a list of tax preparers from local business listings, internet searches and from tax related media. Another very helpful source of getting a preparer is networking. Since majority of taxpayers use a preparer, then it is easy to get a referral of a good preparer who can help you with your taxes.

Review the Consultant Qualifications

Once you have a list of potential prepares to handle your taxes, you will then, need to scrutinize the options. One of the main points in choosing a preparer is their qualifications. At the very least, every tax preparer needs to have a tax preparation license and a Preparation Tax Identification Number (PTIN) issued by the IRS. However, besides this mandatory requirement, there are further qualifications that may be helpful for your specific tax needs. Some issues are more legally-oriented and therefore, you may need an attorney while others may require a CPA. You therefore, need to ensure that the preparer has the right qualifications to handle your needs.

Run a Background Check on the Preparer

As you narrow down on the preparers that you feel are fit to handle your taxes, it is also advisable to do a further scrutiny on the preparer. Confirm various credentials with the various approving professional bodies. You may also verify any licenses with the licensing agents. Check out the preparer with the Better Business Bureau and other authenticating bodies. It is also helpful to do an internet search on the preparer or preparation firm to check if there are any complains on the consultants.

Services Offered

Different preparers provide different tax services. Some preparers only handle IRS taxes while others will handle even state and local taxes. Some tax consultants specialize in seeking Offers in Compromise and installment taxes for their clients. Other services include advisory services, free assistance in case of an audit, loans against refund checks and representation. Therefore, depending on your needs, it is important that you pick out the preparer who provides the specific services you require.

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Getting Ready for Tax Returns Now!

April 9, 2012 By

The tax season is right upon us and the deadline looms. If you are not an early filer, this week is down to the wire to get prepared for the process of filing so as not to get caught up with the deadline. Lucky for you, you have two extra days this year to file (since the filing deadline has been pushed back to April 17th), even if it’s down to the wire. There are various things that you need to start preparing so as to file within time. Below are some of these preparation steps.

Get a Tax Preparer

If you are planning to outsource the work of tax filing this year, you need to quickly secure a tax preparer before it is too late. Usually, all preparers are engaged just before the tax deadline and you therefore need to secure one in good time. You may also consider using a tax preparation software. If your income is below $57,000, you can prepare your taxes free of charge using Free File, an IRS tax software service that the IRS provides in partnership with various private software providers.

Update Your Name and Address

If you changed your name since the last time your filed because you got married, divorced or for whatever reason, you need to ensure that such change is adjusted with the Social Security. You can make the change by going to the Social Security Administration website. If you changed your address during the year, you also need to update the IRS with the new address. You can do so by writing to the IRS of by filing a Change of Address form.

Get the Paperwork Ready

Another important process of tax preparation is keeping your paperwork ready. Whether you are preparing your taxes personally or you are using the services of a preparer, you need to have all the necessary tax documentation ready. The required records include the W-2 forms from your employer, the 1098 and 1099 forms from your stockbroker, mortgage financier or financial institution and the K-1 forms from partnership or S-Corporations that you are an owner. If you made any losses and gains from gambling, you also need to have the records for these. You also need records of sale of property and investments including the purchase receipts of these assets for the purpose of calculating the capital gains. If you are a business owner or are self employed, you need a record of your incomes and your expenses for the tax year being reported. Having a copy of your previous year’s tax returns also helps in preparing the current returns.

Documentation for Tax Reliefs to Claim

Depending on the tax deductions and tax credits that you are planning to claim, you also require the documentation for these. Some of the tax relief related documentation include receipts of medical expenses that you incurred out-of-pocket and that qualifies for tax deduction, acknowledgment of donations to qualifying charities, receipts of educational related expenses that you plan to claim under an education relief, records of mileage covered for qualifying travel such as medical travel, charity related travel or business travel, and records of state and local taxes paid within the year. If you made an adoption within the year, you will also need the receipts relating to the adoption to claim the Adoption Credit.

Get Required Details

If you have dependents that you are claiming reliefs against, you will need the Social Security number of such dependents. If you are claiming Child Care Credit, you will need the details of the address as well as the Social Security number and the Employer Identification Number of the day care provider.

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Factors to Consider When Choosing a Tax Attorney for Tax Help

March 28, 2012 By

When filing tax returns, it is advisable to seek the help and guidance of professionals. The IRS usually advises taxpayers to seek the help of tax professionals when filing tax returns so that they do it efficiently and effectively. The IRS further emphasizes that the taxpayer should, at all times, be responsible for what is filed, even when done by a tax expert. Thus, choosing a tax preparer should be done with utmost care, with someone you can trust.

The IRS requires taxpayers, especially those who seek help from tax experts, to make sure that the professionals sign the tax returns, and also enter their PTIN- Preparer Tax Identification Numbers.

The most important factors to consider when choosing a tax preparer (tax expert) are:

        i.            Qualifications of the preparer. All tax preparers are supposed to be in possession of PTIN, as per the new regulations. Besides having a PTIN, it is important to enquire that they are affiliated to a professional association and that whether they regularly attend educational classes. The IRS is also putting in place test requirements to ensure that tax preparers are qualified and meet all competency requirements.

      ii.            History of the preparer. Here, one should check to see if the preparer has any questionable history, especially in connection with BBB (Better Business Bureau). Further, the taxpayer should check the status of the expert’s license and establish whether and disciplinary actions have been dealt out to him/her. The IRS Office of Enrollment can be contacted to enquire about enrolled agents.

    iii.            The taxpayer should find out whether the taxpayer has an electronic filing system in place. Usually, paid preparers who handle more than ten clients’ returns handle the filing process electronically. With the advancement of technology, it is paramount to choose a preparer who has IRS e-file system.

    iv.            Provide necessary receipts and records required to prepare tax returns. Normally, reputable preparers ask a number of questions so that they can be able to accurately determine an individual’s total income, and their qualifications for deductions, expenses, and other key necessities. It is a violation of the rules of the IRS e-file system to use a preparer that files returns electronically before receiving his/her Form W-2.

      v.            The tax preparer chosen should always be available for consultation. It is important to choose a tax preparer that is available for consultation, even after the date of submission of returns is due, just in case issues to do with tax returns emerge later on .

    vi.            A blank tax return form should never be signed. One should avoid any preparer that requires him/her to put your signature on a blank return.

  vii.            The preparer should sign and include his/her PTIN in the form. The law requires that any paid preparer signs and put his/her PTIN in the return form. The responsibility of the contents of the form lies in the taxpayer’s hands and not the preparer. The taxpayer must also obtain a copy of the return from the preparer.

  1. Before signing the return, it is important for the taxpayer to carefully review it. He/she must go through the returns and ask questions where there is doubt; it is important to understand the contents of the return before signing it.

    ix.            Enquire about the service fee of the preparer. Preparers who charge their fee based on a fraction of the refunds should be avoided. Similarly, those who boast that they can get larger refunds should also be avoided. Any refund from the IRS should be deposited into the taxpayer’s account and not the preparer’s.

      x.            Abusive or suspected tax preparers should be reported to IRS. They can be reported to the IRS by filling out Form 14157.

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5 Tips to a More Effective 2012 Tax Season

February 28, 2012 By

 The 2012 tax season is finally here and taxpayers have started filing returns. If this is the time you are getting started with your returns, then the tax tips below may help you with this process

Get all Your Paperwork in Order

The most important task for your tax preparedness is proper filing of all your tax related documentation. This will help you or your tax preparer prepare your tax return with ease and accuracy. You do not have to remember entries or expenses that you incurred in the beginning of last year. These important documentation for filing includes all Form 1099s – this include 1099DIV for dividends, 1099INT for interests, 1099MISC for payments that you received for services offered to other business, among other 1099 forms. The W-2 forms are also an important documentation as it shows the wages that you received and the taxes that were withheld from these incomes. These forms will help you with the income section of your Form 1040. Besides incomes, you need to file any expense receipts that you are seeking to claim tax deductions or credits. These includes payment for qualifying medical expenses, acknowledgment of donations made to qualifying charities, educational related expenses, child care expenses, car related expenses, receipts for business related expenses, payment for qualifying work uniform and such like receipts. If you bought or sold a house or other asset, you will need the documentation for calculating capital gains at the point of sale. Various other federal and state tax entries may require other support documentation

Use the IRS Free File System

Another tax tip for 2012 is to use the Free File System. Taxpayers can now use the system to prepare their taxes for the 2011 tax year. For taxpayers who had an annual income of less than $57,000 in 2011, they have an option of 20 tax preparation software to choose from to prepare their taxes free of charge. The software is available on the IRS website.

File Electronically

You can also consider filing your taxes this year electronically if you have never done so. The e-filing system has become a huge success for the IRS over the years with the 2011 tax returns recording the highest percentage of e-filers with 79% of all filers choosing to file electronically. Filing electronically comes with several benefits. Firstly, you get to receive your refund check much faster. The IRS endeavors to process refunds within 5 days for those who file electronically and choose the direct deposit option of receiving the tax refund. Besides getting refunds faster, the e-filing system also helps with the addition of numbers, as this is done automatically. E-filing is also convenient as you can file at anytime and you do not need to incur costs of posting or delivering paper returns.

Consult a Professional Early

This year, you can also consider getting a consultant early to prepare your taxes before the tax season picks up. Getting a consultant early is much easier as compared to tax time as most consultants get engaged as the deadline draws nearer. You also get to have more time with the tax professional and you can get tax advice, get answers for questions you may have relating to taxes and also have more scrutiny and attention being given to your return.

Make Use of the IRS Website

The IRS website is has a wealth of information and resources for any tax related issue. The website has also been greatly enhanced and improved in 2012. The navigation of the website has been improved and there are now easy shortcuts to your favorite sections. You can also get information about credits, deductions and videos to help you with your returns.

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Considerations When Seeking a Tax Preparer

February 23, 2012 By

Most taxpayers in the U.S. prefer to use a tax preparer to file returns. If you are one of these taxpayers, you need to start identifying the professional to handle your taxes in good time before the tax season sets in. There are various factors you should consider when seeking the ideal preparer to handle your taxes. Below are some of these factors:

Skills and Qualifications

One of the considerations when selecting a tax preparer to handle your taxes is skills and qualifications. Find out the skills that a preparer has to handle your taxes. As of 2012, all tax preparers are now required to get Preparer Tax Identification Numbers (PTIN) after registering with the IRS. Your preparer should therefore posses this license to legally prepare your taxes. Besides this, you should consider other qualifications such as CPA certifications or an attorney with tax specialty. There are also other trainings and skills that can qualify one to professionally handle your taxes and you need to review such qualifications.

Experience

The other important consideration is ones experience. Even with the right qualifications, you get to enjoy better quality services if you go for an experienced preparer. There are some issues and procedures of taxes that are better handled from an experience perspective. When it comes to dealing with IRS audits or complicated tax matters, you may also be better placed if you are dealing with a more experienced professional. Therefore, always ask for the years that one has been practicing in the field and the number of clients that he or she has handled over the year.

Availability and Reliability

The availability of a tax preparer is yet another important consideration. There are many preparers who handle too many clients to the extent that they cannot provide you with quality services. You should weary of such preparers. Try and get a tax preparer who has time for you and who is able to give you personalized service. He or she should be able to give you tax advice as he or she prepares the taxes. You can tell the availability of the preparer by the amount of time that one is willing to spend with you and how often one gets to communicate with you proactively.

What Returns they Handle

Another important consideration is the type of taxes that the preparer handles. There are tax preparers who only handle Federal taxes and do not handle State and local taxes. There are yet other preparers who only handle issues of negotiations with the IRS when it comes to installment taxes or Offer in Compromises. You therefore, need to ascertain the scope of taxes handled by a preparer so as to know whether he or she can handle all of your tax needs.

Terms of Service

You should also review the terms of service that a preparer gives you for his or her services. Some tax preparers undertake to handle any IRS audits should one arise from returns that he or she has prepared on your behalf. Others will not handle audits or will handle such audits as an extra paid service. There are preparers who provide tax refunds in advance.

Fees

Different tax preparers will charge different fees for their services. You therefore, need to review the charges levied and the terms of payment. You should be weary of tax preparers who request a commission based on the amount of refund they are able to get you as most of such preparers use unorthodox and illegal ways of inflating your refunds. You should also be careful of preparers who insist on receiving refunds on your behalf.

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Tax Preparer Compliance Update and Related TIGTA Report

February 16, 2012 By

The IRS introduced new tax preparer rules that came to effect in January 2012. The rules have been put in place to increase surveillance and ensure professionalism in the tax preparer industry. All tax preparers are now required to apply for a Preparer Tax Identification Number (PTIN) license. This license is to be renewed every tax year. For professionals including CPAs and attorneys, getting the PTIN will be automatic as long as there are no outstanding issues with the IRS. For the other tax preparers, they will be required to sit for an exam to evaluate their ethics and their competence in handling taxes. Besides this competence test, these preparers will also be required to undertake a 15 hours tax training every year before renewing their license. 

12% Yet to Comply

According to the rules that were introduced in 2011, every tax preparer who sort to practice in 2012 and who is not a qualifying professional needed to have sat for the competence test by December 31st of 2011. As of this date, 12.5% of preparers were yet to comply. This means that in 2012, there will be less preparers available to assist taxpayers with their returns.

TIGTA Report Reveal Felons and Prisoners Received PTINs

An audit by the Treasury Inspector General for Tax Administration (TIGTA) revealed that there were some anomalies about the preparers who managed to register in time for the 2012 tax year. According to the audit report, there were 962 prepare who had received the PTIN license but who had been imprisoned in the last 10 years. A vast majority of these people did not disclose their felony convictions. Furthermore, to add the proverbial insult to injury, about 320 of these prepares were actually serving a sentence at the time of application. In fact, 43 of them were actually serving life sentences!

The issue of having convicts as prepares is especially serious as there have been quite a number of tax return frauds that have been done from prisons in the past. In response to these frauds, the IRS had committed to keep those in prisons from having preparer licenses.

Rules did not Prohibit Prisoners from PTINs

Having prisoners and people who had recent felony convictions being licensed with the PTIN license may not have been entirely an oversight on the part of the IRS. This is because the rules of application for preparers did not require one not to be a prisoner. This means that the preparers actually held the licenses legally.

IRS Commits to Increase Vetting of Preparers

Following the TIGTA audit report, the IRS has adjusted its tax preparer rules and from beginning of 2012, no person who is serving a jail term will be permitted to be a preparer. This means that all the 320 convicts will have their licenses suspended. The IRS has also committed to ensure that no person with an IRS criminal record gets a PTIN license.

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