February 11, 2014
The U.S. Court of Appeals decided today that the IRS does not have the authority to require testing or continuing education for RTRPs. Read the Appeals Court decision here
NSA EVP John Ams is in DC to observe oral arguments presented in the Loving v. IRS Case. Click here to read a summary.
A federal appeals court in Washington, D.C., has scheduled oral arguments for September 24 to hear the IRS's appeal of Loving v. IRS court ruling. Read more here
Fee amounts collected for scheduled registered tax return preparer test appointments canceled due to the court ordered injunction are being refunded. Additionally, fees collected from return preparers who tested on or after January 18, 2013, the date the test was enjoined, are also being refunded. No additional refund or reimbursement requests related to registered tax return preparer regulation are being provided or considered at this time. E-mail notifications will be provided to those receiving refunds to explain the process. No action is necessary to receive the refund. A credit for the test fee will automatically be made to the account used to pay the fee. It is anticipated that all refunds will be processed by July 19, 2013. See the IRS FAQs
As reported in last week’s NSAlert, the U.S. District Court of Appeal for the D.C. Circuit has denied the IRS’s request for a stay of the decision in the tax preparer case, Loving v. Commissioner. This clears the way for the Appeals Court decison on the key issue in the case: does the IRS currently have statutory authority to regulate tax return preparers? The IRS late Friday filed its brief with the Court, a copy of which is available here. Loving’s attorneys will then file a reply brief and the IRS will then file a response to the Loving brief. An oral argument may or may not be scheduled at that point (the District Court thought matters were clear enough at this stage that a hearing was not even held), followed by a decision. The timing of a decision is obviously unclear.
The D.C. Circuit Court of Appeals has denied an IRS request to lift the injunction on the tax preparer regulation program.
Read more about the latest developments here
The Justice Department on February 25 filed a motion at the appeals court level again requesting a stay of the permanent injunction imposed on the IRS return preparer program as it appeals the ruling of the U.S. District Court. (Loving v. United States, D.C. Cir., No. 13-5061, motion filed 2/25/13).
A motion for a stay of the permanent injunction imposed on the IRS's preparer program in Loving by Judge James Boasberg of the U.S. District Court for the District of Columbia was denied by Boasberg on February 1. NSA members will recall that Boasberg’s ruling in the court case found that the IRS does not have the authority to regulate tax preparers who are not certified public accountants, enrolled agents, attorneys, and enrolled actuaries and thus cannot compel them to take a competency examination or continuing education.
Click here to see a copy of the DOJ motion
As expected, the Department of Justice has filed a Notice of Appeal on behalf of the IRS for the recent Loving v. IRS court ruling. No official comments or guidance have been given with regards to a timeline for an appeal.
At this point in time, the IRS has said that they are not enforcing use of the RTRP designation with regards to certificates or using the designation on business cards. For those individuals who took the RTRP test in January but have not yet received a certificate, the IRS has only commented to say that no certificates are currently being sent out.
With the regards to voluntary RTRP testing, the IRS has commented that they are examining all possibilities moving forward.
PTIN Update: The IRS has reopened the PTIN system after a two week review. The PTIN system is being updated to reflect current requirements. Until those updates can be completed, a screen titled Continuing Education (CE) Completion may appear during PTIN renewal. Please check either one of the boxes on that screen. This information is NOT being collected, but you must check a box to advance to the next screen. Please note: The link to the newly reopened PTIN system is: http://rpr.irs.gov
Read the Special NSAlert for more information.
U.S. District Court Judge James E. Boasberg denied the IRS request to suspend injunction on the recent Loving v. IRS court ruling and added some clarification to the injunction saying that "the IRS is not required to suspend its PTIN program, nor is it required to shut down all of its testing and continuing education centers; instead, they may remain, but no tax-return preparer may be required to pay testing or continuing-education fees or to complete any testing or continuing education unless and until this injunction is stayed or vacated by the Court of Appeals." See the Feb. 1 ruling
The plaintiffs in the IRS v. Loving court case filed a motion in opposition to the IRS motion to suspend injunction. Please note that plaintiff's motion is an advocacy piece that takes the most optimistic view of the plaintiff's case and the most pessimistic view of the IRS's case. Updates to follow on a Court decision once they see the IRS reply brief that will be submitted on Thursday, January 31.
The IRS filed a motion for a stay of the court decision in Loving v. Commissioner. Per the court rules, the plaintiffs will file legal motions in response to the IRS request on Tuesday, January 29, 2013. Two days later on Thursday, January 31, 2013, the IRS will have a chance to file motions in response to whatever the plantiffs file on Tuesday. It therefore seems clear that the court will not have any future rulings until after the start of filing season on January 30, 2013.
The United States District Court for the District of Columbia has enjoined the Internal Revenue Service from enforcing the regulatory requirements for registered tax return preparers. In accordance with this order, tax return preparers covered by this program are not currently required to register with the IRS, to complete competency testing or secure continuing education. The ruling does not affect the regulatory practice requirements for CPAs, attorneys, enrolled agents, enrolled retirement plan agents or enrolled actuaries. Read the court case here.