Friday, July 13, 2012


The NATP National Conference in Baltimore has come to an end.  In my 25-years as an NATP member (and 41 seasons as a paid preparer) I have attended probably 20 of these conferences.  At this point I find that I really do not learn anything new of consequence at Conference - but I do pick up, or am reminded of, an occasional deduction, credit, loophole, technique, or strategy that would apply to a client.  

However, despite my personal reaction, I do say to tax pros - like Iowa, “You Ought to Give the NATP National Conference a Try”!

And many did this year.  I heard that this was the highest attendance in Conference history, with over 1300 attendees.

First and foremost - attending the annual NATP National Conference is an excellent way of taking a tax-deductible vacation (see my recent TWTP post).  Over the years I have visited Anaheim, Atlanta, Arlington, Alexandria, Austin, Boston, Corpus Christi, Minneapolis, Orlando, Sans Antonio, Diego and Francisco, Washington DC, and other locations as a registrant at the NATP and other membership organization tax conferences.

You can arrange your schedule so as to have a full or half-day off for sightseeing.  Here in Baltimore the conference was Monday through Thursday.  I worked it so that I did not have any educational sessions on Tuesday.  While I choose to “sleep in” and start my classes at 10AM and end after 4PM, I could have begun at 8AM and finished by 3PM.  You also have the day before and the day after for local activities.  And of course there is always the evening for dining, theatre, concerts, and the local nightlife.  

The cost of a room is the same whether there is one person in the room or two – so you can bring your spouse and still deduct the full cost of the room.  And, while on a vacation, your primary purpose for being where you are is attending the tax conference, so all of your travel is deductible.

If staying an overnight on a Saturday results in a reduced airfare an IRS ruling allows you to deduct all of your out-of-pocket costs of staying the extra day, even though there are no business activities on this additional day.

The tax savings from the deduction will usually cover at least the cost of the Conference fee, and often ends up providing “reimbursement” for some of the actual travel costs.

While Conference offers the opportunity to stay at a luxury hotel, often excellently located in downtown or waterfront areas, at a discount, sometimes a deep one, you do not have to stay at the host hotel.  Here in Baltimore (on the waterfront) the Marriott room rate was $149 for conference attendees (actually over $170 per night after taxes and other charges).  I stayed in the Mount Vernon Cultural District at a mid-level chain for just under $70 per night (total cost) and about $20 per day in taxis to and from Conference. 

If I were in better shape/condition I could have taken a free bus from my hotel to the waterfront area and walked to the host hotel.

Now that the IRS requires RTRPs to maintain at least 15 hours of annual CPE in federal taxation, the Conference allows you to fill some, or all, of these credit hours.  You can easily earn more than 15 hours of CPE at Conference.  And the offerings include the required 3 hours of “updates” (I.e. Current Developments for both individual and business tax issues) and several hours of ethics preaching.

I am unique.

·      I do not accept any new 1040 clients, and I do not do any partnership, sub-S corporation, or estate tax returns.  

·      I have no desire to represent taxpayers in dealings with the IRS (other than to attend the audit of a return I have prepared). 

·      While I do believe that you can teach an old dog new tricks, this old dog does not necessarily want to learn new tricks, especially when it may apply to only one or two, or none, of my current clients once or twice. 

·      Because I write extensively during the year on tax topics I must keep abreast of “current developments” as they happen via independent reading and research.  And I always attend the NATP’s year-end “Famous 1040 Seminar” (or as it is now called “The Essential 1040”), which covers current developments through November.

So there are only so many sessions offered at Conference of interest, or actual value, to me. 

However, for a younger preparer, or one wishing to develop or expand his/her practice, there is a multitude of sessions on a wide variety of tax preparation and planning and practice management topics taught by, in most cases, excellent speakers who are experts in their particular topic.

FYI – the 2013 conference is July 8 – 11 at the JW Marriott Desert Ridge Resort & Spa in Phoenix, Arizona, and the 2014 conference is August 11 - 14 at the Marriott World Center in Orlando, Florida (again, extremely hot locations, weather-wise, at the hottest times of the year – my main complaint with NATP about the conferences).


Tuesday, July 10, 2012


I am in Baltimore attending the National Conference of the National Association of Tax Professionals, held this year at the Baltimore Marriott Waterfront.  See my post on the conference at THE WANDERING TAX PRO (and my afterthought).

The Keynote Speaker at the opening ceremonies was David R Williams, Director of the IRS Tax Preparer Office, who is in charge of the IRS new regulation regime.

David began by telling us that the impetus behind the regulation of tax return preparers is the fact that the Tax Gap has grown to $450 Billion.  It is the hope of the IRS that improving the quality of tax return preparers will result in more correct tax returns being filed, and ultimately help to make a dent in this Tax Gap.

When the regulation regime officially kicked off last year there were almost 848,000 PTINs issued by the IRS.  Only 715,000 renewed for calendar year 2012 – a loss of 133,000.

There are currently 3,269 previously unenrolled tax professionals who have taken and passed the initial competency test to receive the new RTRP (Registered Tax Return Preparer) designation.  This leaves almost 339,000 RTRP “candidates” – previously unenrolled preparers who need to take and pass the test by December 31, 2013 (I am in this number).  That is a lot of tax preparers.

David says that the IRS wants potential preparers to “demonstrate basic competency”, by passing a test and maintaining minimal annual CPE in taxation, before being allowed to prepare 1040s for compensation.  This is a bold-faced lie! 

The IRS has no interest in being sure that all preparers “demonstrate basic competency” - because about 300,000 of the 715,000 current PTIN holders do not have to demonstrate any competency and do not have to remain current by taking annual CPE in taxation.  I am, of course, talking about the CPAs, attorneys, and “supervised employees” who are exempt from the test and CPE requirements.

David does not address this serious issue – quickly glossing over it by implying that CPAs and attorneys demonstrate competency by virtue of having taken the CPA and bar exams – another bold faced lie.

David stated in his presentation that the IRS does not plan to extend the 12/31/13 deadline for passing the RTRP test.  He also says it is not the intention of the IRS to take away the ability to make a living from previously unenrolled preparers – but will the IRS do this when the deadline passes and 100,000 or so RTRP “candidates” have still not taken and passed the test?

I wonder if the 339,000 “candidates” have not taken the test yet because they want to make sure the IRS gets all the “bugs” out before doing so, or if they are waiting in hopes that the IRS will eventually embrace common sense and provide some kind of “grandfathering” – both good reasons for procrastination in this matter, and both reasons why I have not yet sat for the test.

David told us that CPE requirements will be enforced for RTRPs, and RTRP candidates, for calendar year 2012.  The IRS has arranged for authorized CPE providers to provide information, based on PTINS, directly to the IRS – so at renewal time required CPE can be automatically verified.  There will, no doubt, be some glitches (i.e. CPE taken in December may not be uploaded in time) and tax professionals will be able to “attest” to their 2012 CPE, without immediate IRS verification, when renewing their PTIN for 2013.

He also put our minds at ease by affirming that fingerprinting of PTIN holders has been put on indefinite hold while the IRS investigates alternate methods of conducting “background checks”.

And he announced that the IRS hopes to have a public online database of RTRPs available after the 2013 tax filing season (when 2012 returns are prepared).

To be honest - as I pointed out to an NATP staffer at the NJ-NATP luncheon on Monday afternoon – with all its flaws I would rather have the IRS regulate tax preparers as it currently does than have the idiots in Congress legislate regulation.  As you know full well, the idiots in Congress could “f**k up a High Mass”.  And David Williams is an excellent choice for Director of this process.  He is intelligent and sincere.  We certainly could have done much, much worse.

However the current regulation regime has serious problems with its refusal to grandfather and its exemption of CPAs, attorneys, and “supervised employees” from testing and CPE.  We must continue to publicize and criticize these gross inequities in the system.