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Professional Tax Education

Phase 1: PTINs for Everyone
Beginning January 1, 2011, all paid preparers must have a Preparer Tax Identification Number before
preparing returns. You can sign up for your PTIN online or by paper application. It costs $64.25 per year.

To get your PTIN online, go to www.irs.gov and click on Tax Professionals.

PTIN Renewal:
PTINs that were obtained for the 2011 filing season will expire on December 31, 2011. Renewal will be
available in mid-October 2011. Preparers who applied for their PTINs on paper will be able to renew
either online or on paper. Paper renewal will take 4-6 weeks to process. You must renew your PTIN
before January 1, 2012.

Phase 2: Background Checks, Testing, and Education Requirements for Some Preparers

Preparers will need to:
Renew their PTIN annually.
Submit fingerprints for a background check.
Pass a competency test.
Take continuing education courses annually.

The IRS expects to begin offering the exam and fingerprinting in approximately October 2011. Those
who already have a PTIN will have until the end of 2013 to take and pass the exam and to pass the
background check.

The continuing education requirement is expected to start in 2012

Competency Test
The test is part of an ongoing effort by the IRS to enhance oversight of the tax preparation industry.

Although individuals who already have a provisional preparer tax identification number (PTIN) from the
IRS do not have to pass the exam until Dec. 31, 2013, they may take the exam at any time once it is
available.

The test will have approximately 120 questions in a combination of multiple choice and true or false
format. Questions will be weighted and individuals will receive a pass or fail score, with diagnostic
feedback provided to those who fail.

Test vendor Prometric Inc. worked with the IRS and the tax preparer community to develop the test. The
time limit for the test is expected to be between two and three hours. The test must be taken at one of
the roughly 260 Prometric facilities nationwide.

To assist in test preparation, the list in the left column is a list of recommended study materials with links.
This list is not all-encompassing, but a highlight of what the test candidates will need to know.

Some reference materials will be available to individuals when they are taking the test. Prometric will
provide individuals with Publication 17, Form 1040 and Form 1040 instructions as reference materials.

The fee for the test has not been finalized but is expected to be between $100 and $125, which is
separate from the PTIN user fee. Currently there is no limit on the number of times preparers can take
the test, but they must pay the fee each time. Individuals must pass the test only once.

Only certain individuals who prepare the Form 1040 series are required to take the test. Attorneys,
Certified Public Accountants and Enrolled Agents (EAs) are exempt from testing and continuing
education because of their more stringent professional testing and education requirements. Also exempt
are supervised employees of attorneys, CPAs, attorneys or EAs who prepare but do not sign and are
not required to sign the Form 1040 series returns they prepare and individuals who prepare federal
returns other than the Form 1040 series.

Approximately 730,000 return preparers have registered and received PTINs in 2011. Approximately 62
percent do not have professional credentials. The IRS does not yet know how many preparers will fall
into other exempt categories, but those individuals will be required to identify themselves when they
renew an existing PTIN or obtain a new PTIN beginning in October 2011.

The IRS will notify those preparers who have a testing requirement and provide more details. Once the
test is available, preparers who have on-line accounts can use their accounts to schedule a test time
and select a Prometric site.
IRS Tax Preparer Registration
Reference Material
"TaxEase Preparer
Review"

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