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IRS’s Intent to Appeal Sparks Debate

Let’s review.  In January, a trio of independent tax preparers filed suit challenging the IRS’s authority to impose its Registered Tax Return Preparer regime – something it developed with the hopes of increasing the quality of the tax preparation industry and improving service to taxpayers.

A federal judge ruled the IRS lacked the authority to impose the RTRP system, denying them the opportunity to require tax preparers to pass a competency exam and complete continuing education requirements.  The IRS immediately asked the ruling be suspended so tax season would not be disrupted, but that motion was denied.  So in late February, the IRS filed an intent to appeal the original ruling, indicating its plan to submit an opening brief sometime this month.

The tax preparers who filed this suit have issued a forceful response to the IRS’s motion.  Part of their retort reads, “Despite the sensationalist, everything-but-the-kitchen-sink claims of harm by Defendant-Appellants (“the IRS”), nothing justifies extraordinary relief in this case.”  Iy continues, “Notably, the IRS fails to allege any imminent, irreparable harm. This tax season is unaffected because the IRS had already postponed its deadlines to the end of this year two weeks before the injunction issued.”

The lead attorney for the plaintiffs, Dan Alban, said in an interview last Friday, “They’re talking about a program which, even under a worst case scenario that they allege, would just be delayed by one year.” He added, “They’ve already taken three or four years to roll out this program in the first place. There hadn’t previously been, for the last 100 years, licensing of tax preparers, so it just doesn’t seem like a plausible claim of irreparable harm.”  He feels very strongly that the IRS’s motion for extraordinary relief, fails to prove any immediate or irreparable harm a delay in the implementation of this program presents.

Kenya Hoffart, Industry Writer

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