Business Tax Preparation

Business Tax Preparation is often involved in tax preparation and filing of individual and corporate tax returns. The preparers are usually accountants or CPAs.

Tax preparation by Business Tax Preparation may be done by the professionals or the taxpayer with or without the help of tax preparation software and online services. Tax preparation may also be done by an accountant or a certified public accountant or enrolled agent, or by an unlicensed Business Tax Preparation. Because United States income tax laws are considered to be complicated, many taxpayers seek outside assistance with taxes (53.5% of individual tax returns were filed by paid preparers). The remainder of this article describes tax preparation by someone other than the taxpayer.

Some states have licensing requirements for Business Tax Preparationwho prepares tax returns for a fee and some for fee-based preparation of state tax returns only. The Free File Alliance provides free tax preparation software for individuals with less than the adjusted gross income that varies each year. People who make more than $58,000 can use Free File Fillable Forms, electronic versions of U.S. Internal Revenue Service (IRS) paper forms.

Until 2011, the U.S. Internal Revenue Service did not require national registration of paid Business Tax Preparation the United States. However, effective January 1, 2011, new rules required the registration of almost all paid federal tax return preparers. Many of the new rules, however, were soon struck down by a federal court.

The new rules had required that some paid Business Tax Preparationpass a national tax law exam and undergo continuing education requirements. Persons who are certified public accountants (CPAs), attorneys, or enrolled agents were required to register, but were not required to take the exam and were not subject to the continuing education requirements.

For purposes of the registration requirement, the IRS had defined a ” Business Tax Preparation” as “an individual or entity who, for compensation, prepares all or substantially all of a federal tax return or claim for refund. Beginning in mid-2011, tax return preparers (other than CPAs, attorneys, and enrolled agents, and a few others) had generally been required to take and pass a competency test to become a registered tax return preparer.

Business Tax Preparationwho are paid Tax return preparers had a Practitioner Tax Identification Number (PTIN) before testing was to become available were to have until December 31, 2013, to pass the competency test. New tax return preparers would have been required to pass the competency test before they could obtain a PTIN. The IRS had indicated that the new rules would have applied to all kinds of federal tax returns, including income taxes and payroll taxes. A new continuing education requirement of 15 hours per year would have been imposed on tax return preparers (except for CPAs, attorneys, enrolled agents, and a few others).

All Business Tax Preparationwho are paid Tax return preparers, including those tax return preparers who are attorneys, certified public accountants, or enrolled agents, are still required to have a PTIN. This rule continues to be effective for the preparation of any federal tax returns after December 31, 2010