Resolution on regulating paid tax preparers is withdrawn after concerns raised
On Monday, the Section on Taxation withdrew Resolution 104, which would have made ABA policy calling for a federal law to regulate paid tax preparers.
The resolution stemmed from two 2014 court decisions, Loving v. Internal Revenue Service and Ridgely v. Lew. Both decisions interpreted IRS Circular 230, the IRS rule that authorizes attorneys, CPAs, enrolled agents and others to “practice” before the IRS.
A 2011 amendment to Circular 230 had brought all paid tax preparers under IRS regulation. But Loving and Ridgely found that the amendment exceeded the IRS’s statutory authority.
This left some categories of paid tax preparers unregulated by the IRS or professional regulators, raising concerns about unscrupulous tax preparers. The Loving court noted that “more stringent” regulation might be wise, “but that is a decision for Congress and the President to make if they wish.”
The opposition was concerned that the resolution’s language could invite regulation of attorneys by entities other than state bar regulators. Delegate Tom Bolt of the U.S. Virgin Islands noted at a Rules and Calendar committee hearing Sunday that the ABA has opposed this type of regulation several times in the past.
At an informal meeting Sunday, delegate Robert Lipton of Chicago said the section would rewrite the resolution rather than abandon it. Susan Serota of New York, speaking at Monday’s meeting, said the Section on Taxation planned to resurrect it at the 2015 Annual Meeting in Chicago.
