Section 1 Short title
This Act may be cited as the “Tax Return Preparer Competency Act of 2015”.
Tax Return Preparer Competency Act of 2015
A BILL
To ensure that tax return preparers demonstrate minimum standards of competency.
Sec. 2 Minimum competency standards for tax return preparers
by striking paragraph (1) and inserting the following:
“(1) regulate—
“(A) the practice of representatives of persons before the Department of the Treasury; and
“(B) tax return preparers (as defined in section 7701(a)(36) of the Internal Revenue Code of 1986); and”
in paragraph (2)—
by inserting “or tax return preparer” after “representative” each place it appears; and
by inserting “or in preparing their tax returns, claims for refund, or documents in connection with tax returns or claims for refund” after “cases” in subparagraph (D).
Failure To meet minimum competency standards— Subsection (b) of section 330 of title 31, United States Code, is amended—
by striking “before the Department”;
by inserting “or tax return preparer” after “representative” each place it appears; and
in paragraph (4), by striking “misleads or threatens” and all that follows and inserting
“(A) any person being represented or any prospective person being represented; or
“(B) any person or prospective person whose return (as defined in section 6696(e)(1) of the Internal Revenue Code of 1986), claim for refund (as defined in section 6696(e)(2) of such Code), or document in connection with a return or claim for refund, is being or may be prepared.”
Minimum competency standards for tax return preparers—
In general— Section 330 of title 31, United States Code, is amended by adding at the end the following new subsection:
“(e) Tax return preparers
“(1) In general—Any tax return preparer (as defined in section 7701(a)(36) of the Internal Revenue Code of 1986) shall demonstrate minimum competency standards under this subsection, by—
“(A) obtaining an identifying number for securing proper identification of such preparer as described in section 6109(a)(4) of the Internal Revenue Code of 1986;
“(B) satisfying the examination requirements described in paragraph (2);
“(C) satisfying the annual continuing education requirements described in paragraph (3); and
“(D) completing a background check as described in paragraph (4).
“(2) Examination
“(A) In general—A tax return preparer shall provide the Secretary with proof of successful completion of an examination that evaluates the knowledge and competency of the tax return preparer, as prescribed by the Secretary through regulations, forms or instructions, regarding—
“(i) preparation of a return (as defined in section 6696(e)(1) of the Internal Revenue Code of 1986);
“(ii) ethical standards for preparation of such returns; and
“(iii) other topics as the Secretary may prescribe.
“(B) Exceptions—The Secretary shall exempt tax return preparers from the examination requirements under this paragraph pursuant to such requirements as are determined appropriate by the Secretary, which shall include any comparable examinations administered by the Secretary or any comparable State licensing or registration programs.
“(3) Continuing education—A tax return preparer shall complete continuing education on an annual basis, which shall consist of not less than 15 hours of instruction, which shall include not less than 2 hours of training relating to ethics and not less than 3 hours relating to Federal tax law updates.
“(4) Background check
“(A) In general—A tax return preparer shall demonstrate the requirements of subsection (a)(2) by providing the Secretary with a report, as prescribed by the Secretary through regulations, forms or instructions.
“(B) Exceptions—The Secretary shall exempt tax return preparers who have been subject to comparable background checks administered by the Secretary or any comparable State licensing or registration programs.”
Contingency fees— The Secretary of the Treasury may not regulate, prohibit, or restrict the use of a contingent fee in connection with tax returns, claims for refund, or documents in connection with tax returns or claims for refund prepared on behalf of a taxpayer.
Public database for tax return preparers— Not later than 1 year after the date of the enactment of this Act, the Secretary of the Treasury, shall ensure that the name and identification number (as described in section 6109(a)(4) of the Internal Revenue Code of 1986) of any tax return preparer who satisfies the requirements under section 330 of title 31, United States Code, is made publicly available through such measures as are determined appropriate by the Secretary, which may include the use of any publicly available database that has been established and operated by the Secretary on or before the date of the enactment of this Act.