We are just weeks away from a new tax season, and that means it’s time for tax professionals to renew their Preparer Tax Identification Numbers (PTINs). This identification number expires annually on December 31st for paid tax professionals.
There are currently some 800,000 active tax preparers who prepare federal tax returns for a fee which means they are required to have a valid PTIN. The paid preparer’s PTIN must be included on any return or claim for refund filed with the Internal Revenue Service. Paid tax preparers who don’t have or use a valid PTIN will be subject to penalties.
At $19.75, the fee for a 2024 PTIN is affordable enough, and renewal is simple. The online renewal process takes just 15 minutes to complete. There is also a paper option, Form W-12, IRS Paid Preparer Tax Identification Number (PTIN) Application and Renewal, available along with instructions from the IRS website. Be aware, however, that while the online application is processed in real time, the paper version could take up to six weeks.
PTIN Can be a Gateway to Higher Readiness for Non-Credentialed Preparers.
Acquiring a valid 2024 PTIN is more than a requirement; it can also open doors to higher levels of professionalism for those preparers who aren’t enrolled agents (EAs), attorneys or CPAs. The IRS’ Annual Filing Season Program (AFSP) is a voluntary series of courses tailor-made for the non-credentialed tax pro.
Once they’ve acquired their new PTIN, participants have until Dec. 31 to complete up to 18 hours of continuing education from IRS-approved CE providers, aimed at increasing their knowledge and improving filing season readiness. DrakeCPE offers options for those tax preparers who would like to grow professionally; read more about the classes we offer here.
Participants also must agree to abide by the rules and obligations in Treasury Department Circular 230, Regulations Governing Practice Before the Internal Revenue Service.
For their hard work and cooperation, the successful tax pro gets a diploma of sorts – an Annual Filing Season Program Record of Completion – and something even more valuable: a listing in an online directory of tax return preparers that includes credentials and select qualifications.
This directory is searchable and aims to connect taxpayers with tax professionals in their area who have completed the AFSP or have other credentials recognized by the IRS.
One of the highest such credentials is the enrolled agent, bestowed on tax professionals for their special talents in a number of tax areas, including federal tax planning, individual and business tax return preparation and other representation situations. Enrolled agents have unlimited rights to practice before the IRS and are allowed to represent any client before the IRS on any tax issue. To learn more about what it means to be an enrolled agent and other certification information, check out our blog Certifications for Tax Professionals.
And it all starts with renewing that PTIN.
For more information on PTINs, to renew a PTIN or to apply for a PTIN online, go to IRS.gov/taxpros on the IRS website.