Every year the tax laws change, so keeping up-to-date and taking new certification courses is crucial and, very often, required. A list of some of the courses and what they entail is the subject here.

New IRS regulations require that all paid tax preparers obtain a PTIN (preparer tax identification number). Renewals for the 2012 tax season are likely to start in October of this year. Some tax preparers will need to pass a competency test and background check as well as take continuing education courses.

Current tax and accounting professionals already possess important educational and technical skills. Because they already posses the necessary skills, the objective of a continuing education program is to enhance and strengthen these skills and correspond with the level of professional ability of the tax preparer and accountant. 

PTIN Registrations and Basic Competency Exam: Registered preparers have three years to pass a basic competency test.  Beginning in the summer of 2011, the IRS updated basic competency exam will be available for tax and accounting professionals.

Continuing Education: All registered preparers will be required to complete 15 hours of continuing professional education annually to continue to practice.  The annual CPE must include: Ten hours of federal income tax; 3 hours of federal income tax update; and 2 hours of ethics.

The subject matter of the federal income tax course generally includes the basic concepts found in the Internal Revenue Code.  It will continue an exploration of “income”, in depth, and the difference between ordinary income and capital gains. It will also go into greater detail about the exclusions and deductions that can reduce a taxpayer’s income. The course will also prepare professionals for more in-depth research and how to resolve the new federal income tax issues in their practice.

In the federal income tax update, the course delves into the major provisions of new tax legislation, including, cases and regulations and their impact on individual taxpayers, businesses, investments and retirement plans. The main focus is on tax planning for investments, businesses and financial planning. Useful solutions to problems of the tax professional and comprehensive tax planning is be emphasized.

Everyone in every business setting knows that ethics are an important part of doing business, and for tax professional, that is no different. They are dealing with large sums of money and they are responsible for their clients’ finances. In the ethics course, the tax professional will learn ethical standards, whether employed in public, governmental, or private accounting. These principles are based on the American Institute of Certified Public Accountants (AICPA) Code of Professional Conduct, which is the standard for all tax professionals. The course also explains the issues, developments and problems addressed by recent AICPA and SEC Ethics updates.

Just to be clear, the following types of programs do not meet the objective of continued certification:

Courses that help prepare for the Special Enrollment Examination (the test that individuals take when they first become a tax professional); basic tax courses tailored to the general public that a tax professional should already know; or programs not directly related to Federal taxes.

There is still time to register for the 2011 course. You can find the registration form at http://www.irs.gov/newsroom/article/0,,id=228266,00.html.

Daniel Stoica Accounting Professional