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If you want to officially prepare tax returns for a living, you must obtain an IRS Preparer Tax Identification Number, or PTIN.
Obtaining a PTIN is relatively easy and once you’ve got it, you are authorized to prepare tax returns for compensation.
PTIN holders without certain qualifications or credentials, however, are limited to tax-return preparation and cannot represent clients before the IRS. Certain tax professionals enjoy unlimited representation rights, meaning they can represent clients in matters pending before the IRS, such as audits, appeals or issues regarding the payment or collection of taxes.
Professionals with unlimited representation rights have additional education, certifications or credentials. These individuals include enrolled agents, attorneys and certified public accountants, among others.
Applying for a preparer tax identification number, or PTIN
When you apply for a PTIN, you must provide the following information to the IRS:
- Your Social Security number.
- Name, mailing address, date of birth.
- Relevant business information (name, mailing address, phone number).
- Your individual income tax return for the prior year, with name, address and filing status.
- Explanations for any felony convictions.
- Explanations for any issues related to paying individual or business tax obligations.
- PTIN user fee of $50, payable by debit or credit card.
- Any relevant certification or credential information (for CPAs, attorneys, enrolled agents, enrolled actuaries, enrolled retirement plan agents, certified acceptance agents, or state licenses).
Once you’ve compiled all necessary information, head to the IRS PTIN website.
- Create an account and wait for receipt of the system-generated temporary password.
- Change your temporary password to a permanent one and complete the PTIN application.
- Pay the $50 PTIN fee.
- Once you’ve received notification that your bank has processed the fee, log back in to the IRS website to retrieve your PTIN.
All communication with the IRS regarding your PTIN application will be conducted using a secure messaging system accessed via the IRS website. Make sure you retain a copy of all communications and documentations related to your PTIN in the event you are asked to provide proof of authorization.
Who regulates tax-return preparers?
The secretary of the treasury regulates professionals who prepare tax returns, as well as those who represent taxpayers in front of the IRS.
The Office of Professional Responsibility in Washington, D.C., a department of the IRS, is tasked with making sure tax-return preparers meet the requirements for the job and that all tax practitioners, tax preparers and other third parties in the tax system adhere to professional standards and follow the law.