New IRS Changes Making Some Tax Preparers Busier Than Ever
April 12, 2011 (York Daily Record, Pa.) YORK, Pa -- Susan Grove knows it's that time of year.
It's time for 85-hour work weeks at her York Township business, Complete Bookkeeping Services. She'll start tax returns early -- usually 7 a.m. -- and not go home until 11 p.m. or midnight.
The April 18 deadline is fast approaching, and this year seems busier than ever, Grove said, as the IRS weeds out the weak with a new requirement that debuted this year.
Anyone receiving compensation for federal tax services, including attorneys, certified public accountants, and enrolled agents, to apply to the IRS for a "preparer tax identification number" and pay a $64.25 annual fee.
The IRS is also instituting a competency test and continuing education requirements that prospective tax preparers, except enrolled agents, CPAs and lawyers, will need to pass to qualify to prepare taxes.
"Once they realize they'll have to past a test," Grove said, "maybe they realize they aren't qualified."
About 700,000 preparers have registered since Sept. 28, according to the IRS, which estimates that between 800,000 and 1.2 million people previously prepared taxes prior to the requirement.
"The more hoops they have to jump through, the fewer are going to do it year after year," said Jayson Fugal, owner of Liberty Tax Service in York. "It makes it more difficult for smaller operations."
Earlier this week, he said the office had served more than 1,000 clients compared to 312 year-to-date for 2010.
The business, he said, has also absorbed customers who previously patronized H&R Block, a national franchise that wasn't allowed to offer refund anticipation loans this year.
With unemployment high, people are finding ways to make ends meet. Sometimes, this complicates tax returns, said David Riggs, owner of Accounting Services of York in Springettsbury Township.
He cited a 3 to 4 percent increase in clients and a 2 percent increase in business tax returns.
"A lot of people have been out of work or they've tried to start their own business," Riggs said. "If they start their own business, taxes become a lot more complicated, and they need help."
Grove notices similar trends at the business she's owned since 1998.
"We're getting more stranger things than usual that makes returns more complicated," she said. "We're seeing more businesses. We've been getting more foreign people. We've had to do some as non-residents of the U.S."
This year, she filed a tax return for a gay New Jersey couple who moved to the area. Their civil union was recognized in that state, but not in Pennsylvania.
"I'd never done that before," she said. "That was really different."
On April 5, Grove said she was up 48 tax returns and extensions year-to-date. She's turned one person down already.
Her husband, Mike, also works every night and on Saturday, completing all of the returns clients drop off.
"If it hadn't been for him, because the other tax preparers have been tied up with appointments, I don't know how these would have gotten done," she said.