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By Melissa Hoffmann Lajara
Posted on 4/30/09
NEW YORK -- Tax practitioners are among the CPAs not regulated under current New York state law, which also omits those working in industry, academia and consulting. In fact, the state “has absolutely no authority over anyone not doing the attest function,” NYSSCPA Executive Director Lou Grumet told a group of CPAs from Tax Executives International (TEI), on April 21 who came to the Society’s offices to learn how the new law affects CPA tax professionals.
Come July 26, that’s all going to change. When the reform law takes effect, it will bring all CPAs under the same regulatory umbrella through an expanded scope of practice and increased education requirements.
For CPAs working in tax and industry, the law “triggers the obligation to register as a CPA, and that is a triennial registration requirement,” said Dennis O’Leary, the Society’s legislative counsel. Even those CPAs who have been inactive will have to register or file a declaration with the state indicating that he or she is not, in any way, holding him or herself out as a CPA, Grumet said.
“If you do not file that declaration you will be considered to be practicing public accountancy,” he said.
The State Education Department (SED) is currently only able to accept online registration renewals, not new applications, but efforts are underway to change that, O’Leary said. He said new registrants can call the department instead at 518-474-3817, ext. 270. A CPA can find if he or she is registered through the SED’s Office of the Professions Web site.
With the deadline little more than two months away, Grumet suggested registering as soon as possible.
“I would recommend you do it early so you don’t get caught in the crunch,” he said.
This aspect of the law and the new education requirements are the most significant changes for tax professionals.
Surrendering the CPA license is not an option, as a CPA is licensed for life unless resignation of the license is specifically allowed by the SED—or the CPA admits to a substance or alcohol abuse problem.
TEI members who attended the meeting, many of whom are out-of-state CPAs, lobbed case-specific questions at the NYSSCPA panel throughout the session. While some answers could be provided, others could not, because the regulations detailing the law’s specifics haven’t yet been approved. The state Board of Regents, the education authority in New York state, is expected to approve emergency regulations at its May meetings.
Grumet promised to bring unanswerable questions and possible issues to the attention of the SED. Grumet said he and O’Leary have seen draft regulations, which the state Board for Public Accountancy approved at its March meeting, and are in constant contact with the department and will put information out as soon as it’s official and available.
“We have huge input,” he said.
Certified Out of State?
A significant portion of tax professionals attending the session were out-of-state CPAs who practice in New York to some degree. Grumet, O’Leary and Deputy Executive Director Joanne S. Barry fielded a variety of questions along the same theme: Does the law apply to me?
In most cases, the answer was “yes,” but there were some unique situations presented, such as that of a Florida CPA with an inactive license who lives in Westchester, but works in the Connecticut office of a firm headquartered in New York City.
“We’ll ask State Ed that one,” Grumet said, but added that he believed the man would be exempt, as he stated his principle place of business—where he does his daily work—is out of state.
Licensure by endorsement is an option available to
out-of-state CPAs whose home state has similar licensure requirements
to New York’s,
and will require a CPA to have four years of experience in public accountancy
within the last decade, O’Leary said.
“
Licensure by endorsement will be the preferred way to come” to
New York and practice for those CPAs, he predicted.
Enhanced Education
Many tax professionals take continuing professional education courses (CPE) as a matter of principal, to stay up-to-date on the complex and ever-changing internal revenue code. But for some, the new education requirements are a significant change.
“The net now catches a lot more CPAs,” noted Barry. “Anyone who falls into that expanded scope of practice—you are now required to take CPE.”
How much? The SED will require 40 hours per year, or 24 in a specific concentrated and approved area of study, Grumet said.
The reporting year has also changed to a calendar year, and the state will allow any courses taken from September to December of 2008 to count towards 2009’s CPE requirement, an initial 16-month year the NYSSCPA lobbied heavily for.
Spread the Word
Iris Schneider, TEI’s New York Chapter president, said that her organization became aware of the law through heavy coverage in The Trusted Professional. She and Barry S. Agranoff, the chapter’s director, felt they needed to educate their members and contacted the NYSSCPA for help.
But many CPAs, especially those working in industry, may still be in the dark. Grumet called on the group to continue spreading the word to insure no CPA colleagues miss the deadline.
“There are between 24,000 and 35,000 people we need to reach,” he said. “If you know any CPAs in industry or tax, tell them they need to register or [risk] losing their license.”
Melissa Hoffmann Lajara is associate editor of The Trusted Professional. She can be reached at mlajara@nysscpa.org.
