HERE'S A THOUGHT - A FEW MORE CENTS ON A VOLUNTARY CREDENTIAL FOR TAX PROS

Here is a thought.

 

As I mentioned in my post on the “Should the RTRP Survive? My More Than 2 cents Worth”, the Accreditation Council for Accountancy and Taxation, a non-profit independent testing, accrediting and monitoring organization established in 1973, currently offers the Accredited Tax Preparer (ATP) and Accredited Tax Advisor (ATA) credentials.  The ATP is for 1040 preparers and the ATA is for preparers of estate and trust and business entity returns.  The Council also offers two additional accounting-related credentials.

 

Both designations require the applicant to pass a 100 question multiple-choice test, and the ATA also requires five years of experience in tax preparation, compliance, tax planning and consulting, of which 40% must be in tax planning and consulting.

 

The exams are conducted by PSI, an independent organization that provides assessment and evaluation programs for businesses, state governments and professional associations. PSI develops a range of assessments for pre-employment selection, evaluation, placement, and licensure and certification.  The cost of the exam for each credential is $200 plus a $50 registration fee.

 

ACAT offers online ATP and ATA preparatory courses and practice exams.

 

Maintaining the ATP credential requires 72 hours of CPE during each three-year cycle or 24 CPE hours per year.  The 72 hours includes at least 68 hours in taxation or related subjects (accounting, finance, technology, business law) or subjects that relate to your particular area of practice or employment plus 4 hours in ethics (better than 2 hours per year).  The ATA credential calls for 90 hours of CPE during each three-year cycle or 30 CPE hours per year, again 4 of the 90 being in ethics.  I personally believe these CPE requirements are more appropriate than those under the IRS mandatory RTRP regime.

 

There is an $80 annual renewal fee for each credential, or $125 if you possess both.  Neither credential allows the holder to practice before the IRS.

 

ACAT is “affiliated” with the National Society of Accountants (the “other” NSA). The NSA website explains that the ACAT was “established in 1973 by NSA”.  I expect the ACAT is administered by an NSA staff person. 

 

If the IRS does not decide to go ahead with a voluntary RTRP program after it loses the appeal of Loving v IRS, I have proposed an independent industry-based organization to administer a voluntary RTRP-like tax preparer credential in my ACCOUNTING TODAY editorial “It’s Time for Independent Certification for Tax Preparers”.  The ACAT could be this organization by severing its direct ties to NSA to become a truly independent organization and expanding its affiliations to include, along with NSA, the National Association of Tax Professionals, the National Society of Tax Professionals, and any other existing legitimate non-profit tax preparer membership organizations, with representatives of these organizations given seats on its Board of Directors.

 

While the IRS would not necessarily endorse the ACAT credentials, nor would it allow those possessing these credentials to practice before the Service, it could be asked to acknowledge that the ATP and ATA designations are legitimate in representing the level of tax competence and currency of those who possess and maintain them. 

 

The bottom line - why go through the long and expensive process of creating a totally new organization when one already exists.

 

I have not discussed this idea with any ACAT or NSA representatives, but certainly welcome their comments on this idea.

 

So what do you think?

 

TTFN