NYSSCPA Urges Passage of Crowley Tax Preparer Legislation

NYSSCPA Urges Passage of Crowley Tax Preparer Legislation

FOR IMMEDIATE RELEASE

Contact: Lois Whitehead, Public Relations Manager
212-719-8405
lwhitehead@nysscpa.org

NEW YORK, NY, December 7, 2007 - The New York State Society of Certified Public Accountants (NYSSCPA) urges passage of legislation (HR 4318) introduced by Representative Joe Crowley (D-Queens), who is a member of the U.S. House of Representatives Ways and Means Committee, to restore the proper role of CPAs as advocates for taxpayers.

Click here to read the full text of the bill.

"The NYSSCPA supports and appreciates Representative Crowley's actions to equalize preparers and taxpayers' disclosure responsibilities," said David Lifson, CPA, NYSSCPA President. "We hope Congress will act swiftly to maintain the integrity of the tax system and relationship of preparers and taxpayers before the end of the year."

Congress passed a law earlier this year that upends the traditional client relationship for CPAs who help prepare federal tax returns for companies. The Small Business and Work Opportunities Tax Act of 2007 signed into law on May 25 amended Internal Revenue Tax Code Section 6694, which sets the standards under which tax return preparers must operate, and sets the penalties for violating those new standards.

The changes have affected some basic tenets of tax return preparation, such as what constitutes preparation of a tax return, who is a return preparer and when one must sign tax returns.

"Crowley's bill goes a long way to equalizing the penalty standard for taxpayers and preparers. It's critical to the fair and effective administration of the tax system that the penalty not be different for preparers and taxpayers. Setting the standard at substantial authority is both reasonable and rational, especially when considering the complexity of the law, and the lack of guidance in many areas," said Jeffrey Hoops, CPA of Ernst & Young, former NYSSCPA President and current chair of the Tax Executive Committee of the American Institute of Certified Public Accountants.

The new law applies to all returns, amended returns and refund claims due on or before Dec. 31, 2007; 2007 estimated tax returns due on or before Jan. 15, 2008; and 2007 employment and excise tax returns due on or before Jan. 31, 2008. The law requires a major change in how CPAs represent taxpayers by raising an IRS reporting standard for preparers to a higher level than taxpayers must meet. This creates a potential conflict of interest between preparers and their clients.

About the NYSSCPA

Representing 29,000 CPAs, the New York State Society of Certified Public Accountants (NYSSCPA) is the oldest state accounting organization in the nation, celebrating its 110th anniversary this year.

Incorporated in 1897, the Society is a not-for-profit organization that seeks to establish and maintain high standards of integrity, honor, and character among certified public accountants. Its members are CPAs working in public practice, industry, government and education in a state that serves as the home of Wall Street and major financial institutions.

The New York State Society of CPAs is located at 3 Park Avenue, New York, NY 10016. To learn more about the Society call 800-633-6320 or visit the Society’s website at www.nysscpa.org.