Is Your Tax Preparer Legal?

What is the Law?
California requires anyone who prepares or assists with preparing federal and state tax returns for a fee must be either an attorney, certified public accountant (CPA), CTEC-registered tax preparer (CRTP) or enrolled agent (EA).

Individuals caught breaking this law may face penalties up to $5,000 from the California Franchise Tax Board.

New Federal Rules

As of January 1, 2011, the IRS is requiring all paid tax preparers (includes attorneys, CPAs, CRTPs and EAs) who prepare or assist with preparing federal tax returns to have a valid Preparer Tax Identification Number (PTIN).

The IRS also has future plans to require tax preparers who are not attorneys, CPAs or EAs, to complete 15 hours of continuing education each year and pass a competency exam. CRTPs will not be exempt from the education or exam requirements.

Who is CTEC?

The California Tax Education Council is a nonprofit organization that was established in 1997 by the California State Legislature. Our mission is to help protect California taxpayers by making sure unlicensed paid tax preparers are (at minimum) registered, educated and bonded.

What is a CRTP?

Each CTEC Registered Tax Preparer (CRTP) must….

• First complete 60 hours of qualifying education
• Then complete 20 hours of continuing education each year
• Always maintain a $5,000 surety bond

What to look for

Beware of tax preparers who:

• Refuse to sign your tax return
• Refuse to give you a copy of your tax return
• Charge a fee based on a percentage of your refund
• Promise you a refund before reviewing your tax information
• Do not have a written privacy policy
• Refuse or fail to provide proof of a valid PTIN from the IRS
• Claim to be a CRTP, but are not listed on the CTEC website
• Claim to be a CRTP, but will not give you their bond information
• Claim to be legally qualified, but you cannot verify their professional status as either an attorney, CPA, CRTP or EA
• Fail to give you (in writing) their name, address and telephone number
• Prepare your taxes via free online software

Research your preparer here

Report Unregistered Tax Preparers
California Tax Education Council
(877) 850-2832
www.ctec.org
Complete the Noncompliant Complaint Form