The Preparer Taxpayer Identification Number (PTIN) was originated by the IRS in 1999 as a measure to protect the Social Security number identity of tax preparers. At that time, the IRS stated that preparers could use their SSN or apply for the free PTIN. The PTIN was apparently permanent, as it did not need to be renewed. And this was the status quo for 12 years. Read More
Why do some Canadians wish to have a U.S. Social Security number?
Many Canadians are in the process of coming into U.S. tax compliance. One might ask: Why would a Canadian citizen residing in Canada wish to come into U.S tax compliance?
There are two reasons why Canadian citizen/residents file U.S. tax returns:
PTIN stands for Preparer Tax Identification Number. This was originated by the IRS in 1999 to protect the identity of professional tax return preparers. Prior to that time, preparers were required to list their social security number on the prepared return. This, obviously, was a good move that preparers readily accepted as it helped protect their identity. It was simple. You applied for the PTIN, paid no fee, and it was presumably good for life.
Technology has made tax compliance a lot simpler and more efficient. I believe at some point, tax compliance and payment will be a just-in-time activity we can easily do from our smart phone or watch.
But, computer systems and networks need to be extremely secure due to the highly sensitive data and the thieves who work 24/7 to get the data. Just this week, the IRS alerted tax professionals of thieves and scammers trying to get control of practitioner computers to avail themselves of client tax data.
I was shocked by the March 13, 2015 IRS release warning individuals to chose their tax professional carefully. The IRS found that some “unscrupulous preparers” instructed their clients to make individual shared responsibility payment directly to the preparer! That is stealing!
I fault the clients, preparers and the complex system.
The IRS has tried to regulate all return preparers but been held up by a need for a statute change that Congress will have to address (see quick summary from IRS on this). Of course, truly unscrupulous people will still find a way around the law.
So, more is needed to educate individuals about the tax system so they better understand Read More
Everyone agrees that taxes are getting more complicated with every passing year. In our busy lives, staying on top of things is getting very difficult. To add to this if we have to keep track of our household budget, our 401(k)’s, our mortgage & insurance rates, our financial records, and so on, it is sometimes best to leave our individual & small business taxes to professionals. A very good software is still dependent on proper data entry and understanding the bottom line. I know a lot of people who prepare their own taxes but I know of more who miss out on simple things that changed from the previous year.
If you have to pick a professional to prepare your taxes, the Internal Revenue Service urges that you make a wise decision. Always remember, even if someone else prepares your Tax Return, the Taxpayer is still the person responsible for the contents. So choose Read More
The IRS has issued complete rules for its new voluntary Annual Filing Season Program and one must wonder “Why?” What is the IRS hoping to accomplish through this initiative and what use is this program?
It is well-known that the program is a reaction to the IRS loss in the Loving case, which struck down the mandatory preparer registration program. Many preparers jumped on the bandwagon and sought the designation “RTRP,” which was the certification provided by that program. With the demise of the program, the designation is also dead in the water. The IRS has stated that it does not recognize the RTRP designation, but will not comment on whether a professional can use the designation. They have stated that there is nothing to stop RTRP’s from displaying their certificates. Read More