THE TAX PROFESSIONAL

Subtitle

WHO SPEAKS FOR THE TAX PROFESSIONAL?

 

It hit me during the winter 2013 National Association of Tax Professionals’ annual year-end tax update seminar known as “The Essential 1040”.

 

Included in the discussion of the Affordable Care Act, a.k.a. “Obamacare,” was a preview of the complex calculations for the penalty that an individual or family without “adequate” health insurance coverage must pay as part of their tax liability beginning with the 2014 tax return.

 

As I listened to the seminar leader explain this new mess being forced upon us, it occurred to me that one of the problems with the tax preparation industry is that we do not have a national organized “voice” to properly speak for the tax preparer with Congress or the IRS.  

 

Creating a new lobbying organization from scratch would be a difficult and time-consuming task.  As an alternative I have suggested a “Tax Professional Advocacy Council” that includes official representatives of all the current legitimate national tax preparation membership organizations.

 

This past December I sent the following letter to the Board of Directors of the National Association of Tax Professionals, the National Society of Tax Professionals, the National Association of Enrolled Agents, the National Society of Accountants, and the Latino Tax Professionals Association –

 

Dear Board of Directors:

 

I have been a paid tax preparer since February of 1972.  

 

I strongly believe, as do many of my fellow tax professionals, that the tax preparation industry needs a strong and unified voice, a lobby, in Washington to represent the interests of tax preparers before the Internal Revenue Service and Congress.

 

As Congress continues to, in my opinion erroneously, use the Tax Code to administer and distribute federal social welfare and other benefit programs, and the IRS, in response, forces more excessive due-diligence requirements upon us, requiring us to be social workers as well as tax preparers, we should not just ‘grin and bear it’, but fight back.

 

While the IRS, and occasionally Congress, does, from time to time, consult with the tax preparation community on proposed regulations and legislation, I see this as merely a ‘professional courtesy’ that does not carry much weight in the final decision-making process.

 

Although most national tax professional membership organizations have some form of ‘government liaison’ and/or ‘political action’ functions, the limited memberships of the individual organizations are not large enough to provide sufficient ‘weight’ to any lobbying attempts.

 

Just about every other profession has a lobby in Washington. So why not the tax preparation profession?

 

The creation of a new independent organization of tax preparers, or of PTIN-holders, would be difficult, time consuming, and expensive.  My alternative is to create a Tax Professional Advocacy Council that includes official representatives of the National Association of Tax Professionals (NATP), the National Association of Enrolled Agents (NAEA), the National Society of Accountants (NSA), the National Society of Tax Professionals (NSTP), and the Latino Tax Professionals Association (LTPA), and any other legitimate national tax preparer membership organization.  This Council would speak with one voice for the combined memberships of all the organizations.

 

While it has been suggested by some tax professionals that the AICPA be included in the Council make-up, I hesitate to do so.  The AICPA has its own agenda, which is very often contrary to the interests of non-CPA tax preparers.  There are CPA tax preparers in the memberships of NATP, NSTP, LTPA, and probably NAEA, so CPA preparers will be properly represented.

 

One example of the need for a national tax preparation industry lobby is the excessive “due diligence” requirements for claiming an Earned Income Tax Credit.  As mentioned above, we must now become social workers and conduct “background checks” to determine whether an individual qualifies for federal welfare benefits.  We have enough to do just to get a client to provide us with all the financial information necessary to properly prepare their 1040.  We should not be forced to take on this added unnecessary and time-wasting responsibility.

 

If there was a tax pro lobby this organization could have perhaps gone to the IRS and said that if the new due diligence requirements are put into place its XXX,XXX members will refuse to prepare tax returns that include an EITC. The organization could have then worked with the IRS to negotiate regulations that would be acceptable to both the government and the preparer community.

 

The organization could, with a strong and unified voice, testify before Congressional committees, or meet with appropriate Congresspersons, to explain how potential legislation would adversely affect tax preparers, and make sure that the tax preparation community is heard on specific tax issues. 

 

Each membership organization participating could add $5 - $10 to its annual dues to fund the operations of the Council, and can also offer members the opportunity to contribute additional funds to the Council.  Perhaps the organization would establish a permanent office in Washington DC with minimal staff.

 

I believe that, as a side benefit, the existence of such a lobby would be a help to the individual organizations in attracting new members.  Joining a participating organization would add the voice of currently “unaffiliated” tax preparers to the lobbying efforts.

 

I ask that the {name of organization} work with the other national tax professional membership organizations I have identified above to form a Tax Professional Advocacy Council to provide a voice in Washington for the tax preparer.  A similar letter is being sent to the Board of Directors of each of the other organizations.

 

I look forward to hearing your thoughts, and any plans to act, on my proposal.”

 

The first response came from the National Society of Tax Professionals (NSTP) via a letter from organization President Bill Horn.  Bill’s response included –

 

We do agree that our industry needs a united voice to be heard in front of Congress.

 

We believe that the Office of National Public Liaison serves this function – and they are a very vocal and outspoken group of tax practitioner representatives that form this group.

 

The IRS National Public Liaison committee meets ten times a year.  Representatives from the National Society of Tax Professionals along with members of other national organizations such as the American Institute of CPAs, National Association of Enrolled Agents, National Society of Accountants, and other tax organizations make up the 20-member committee.”

 

This is not what I had in mind.  it is certainly not the answer. An independent organization is needed.  Tax preparer membership groups may be represented on this internal IRS committee, but I am not aware that they have not been effective in “protecting” the interests of tax professionals.  

 

I was truly disappointed that no other organization, including NATP, had the courtesy to respond, even if only to disagree.

 

So fellow tax professionals, what do you think about my proposal?