Dick Adams wrote:

- quote -

Several days ago I posted a link to the unabridged 37 page
report by the GAO, but somehow it hasn't shown up here yet.
Out in limbo, somewhere, between here and Catonsville.

Along with another post quoting requirements for taking
allowable deductions.

ChEAr$,
Harlan Lunsford, EA n LA

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Dick Adams wrote:
- quote -

And yet ANOTHER correct answer! "sub-optimal" indeed!

ChEAr$,
Harlan Lunsford, EA n LA
A cut above the rest. (said modestly)

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William Brenner wrote:

- quote -

Not sure if this cut and paste will do the url link, but
here it is, the whole 37 page GAO report. Read it and
weep.
And be astounded. Have a laugh or two also.

http://www.gao.gov/new.items/d06563t.pdf

ChEAr$,
Harlan

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L K Williams <lanny[at]loxinfo.co.th> wrote in news:12463pbl8fdjl69
- quote -

I had people come to me a year or two ago who used a "paid
preparer" who refused to sign their return, claiming they'd
be "less likely to be audited" if he _didn't_ sign the
return. Fortunately, they came to me for corroboration
_before_ they mailed the thing in -- it was a total wreck of
a return. So many things done wrong it wasn't even funny.
And when I did it out correctly, they ended up owing less
tax!

So long as people want cheap, and will swallow claptrap like
"you're less likely to get audited if I don't sign this",
there will be charlatan return "preparers" who cheat people
(and "help" people cheat, themselves, knowingly or not).

Catherine

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Harlan Lunsford <hlunsford[at]bellsouth.net> wrote:
- quote -

Look at the definitions of a paid preparer, I think they are
in Circular 230. A paid preparer does not have to do the
entire return.

For example, if I prepare a tax return for a client but he
has his company bookkeeper prepare a Schedule C which I
include in the return, that bookkeeper can be a paid
preparer!

Lanny K. Williams, CPA
Nawarat, Williams & Co., Ltd.
Income Tax Services for Expatriate Americans

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Seth Breidbart wrote:
- quote -

If he's paid for these services, he is still a paid preparer.

It's over!
ChEAr$$$$,
Harlan Lunsford, EA n LA

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Stuart A. Bronstein <spamtrap[at]sbcglobal.net> wrote:
- quote -

What if he doesn't claim to be a "preparer" but only an
"advisor"? Sometimes he might just advise people on which
forms to use, sometimes how to fill them out; at the
extreme, he advises someone what to enter in every box on
the form, but doesn't actually fill out a form.

Seth

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Stuart A. Bronstein wrote:
- quote -

They will have already risked trouble by not registering.
Signing the returns would possibly expose them to anyone who
might check back on the signature.

In prior years, my returns were done manually, so it was
quite apparent that they were not done by a paid preparer.
This year I used the free web TaxAct site, which provided a
perfectly pristine professional appearing printed product
(note the purposeful alliteration). There is no way to tell
whether or not it was done by a paid preparer. And no way to
find out other than by asking me -- which seems very
unlikely.

Bill

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- quote -

What is the probability that the next person you meet has
more than the average number of hands?

Seth

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"thetaxdon" <thetaxdon[at]yahoo.com> wrote:

- quote -

Nope. Let's say 10 guys with a net worth of $100k each are
sitting in a bar. Warren Buffett stops by for a drink. As
far as net worth is concerned, almost everybody is below the
bar's average.

What you could say is that half of all preparers are below
the median.

--
D.F. Manno
dfm2a3l0t2[at]spymac.com
In the republic of mediocrity, genius is dangerous.
(Robert G. Ingersoll)

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thetaxdon wrote:

- quote -

Technically, you are both correct and incorrect; Such a deal?

Given robustness to violations of normality and a sample size
in excess of two million, the difference between the average
and the median is most likely not statistically significant.

However, I would speculate without evidence that more than
half of all preparers ar sub-optimal.

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thetaxdon wrote:

- quote -

Correction: Half of all preparers are below MEDIAN.

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- quote -

The client would know. Presumably the states, the IRS, or
organizations like NAEA and AICPA would run publicity
campaigns telling the public to check credentials and to
make sure that your paid preparer signs the return. It
wouldn't completely eliminate the unenrolled preparers, but
it would make things significantly harder for them.

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William Brenner <wbrenner[at]nospamplease.net> wrote:

- quote -

I think the law requires the preparer to sign the return, or
at least most kinds of returns. So if the guy is ever
caught, he could get in trouble for that alone.

Stu

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Dick Adams wrote:
- quote -

An "unenrolled preparer" could easily bypass any regulation
or registration requirement by merely not signing the
return. With all the tax preparation software in private
taxpayer hands or accessible via the web, who would know the
difference?

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I would say half of all preparers are below average.

Don in Colorado

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"Dick Adams" <rdadams[at]smart.net)> wrote

- quote -

And the states, being hungry for additional revenue, will be
more than happy to trip all over themselves to get such a
program established.

--
Paul Thomas, CPA
paulthomascpapc[at]bellsouth.net

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Mark Bole <makbo[at]pacbell.net> wrote:
- quote -

The issue is not National Chains, but the competency of tax
preparers. From a research standpoint, they did not do a
valid study. The sample was not random and the sample size
is too small. The artice clearly recognized this:
"The study by the Government Accountability Office was small
-- only 19 returns, which the GAO cautioned cannot be used
to generalize to the entire commercial return-preparation
industry -- but on only two returns did the preparer
produce what the agency determined was the right amount.
And even those two had mistakes, though they did not
affect the final tax amount."

It is my opinion (better yet hunch) that this exercise was
done as a stalking horse for at a minimum registration and CPE
requirements for "unenrolled preparers." Quite possibly for
licensure by examination of now "unenrolled preparers." It
may also be vaporware to rattle the cages of the national
chains to negotiate something between my two hunches.

And then we read:
"The GAO noted that several hundred thousand certified
public accountants and lawyers are authorized to practice
before the IRS and that another group of about 41,000,
known as enrolled agents, must pass an examination or have
worked for the IRS."

That reads to me like a so thinly veiled threat that it could
be compared to putting a table napkin over your Glock. <g
A very important point on this that should not be overlooked.
Very few States have examination/licensure for the preparation
of State tax returns. In many States unlicensed accountants
have a very strong lobby working to prevent this. If the Feds
were to mandate this, many States may use this a leverage to
initiate State licensure.

- quote -

1. When logic and taxation converge, it was most likely the
result of the Congress being asleep at the switch.

2. Applying logic to IRS decisions is an exercise in
futility. Many of their decisions are simply adminstrative
overkill and almost all are ladened with unforeseen
consequences.

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William Brenner wrote:

- quote -

If you are the IRS, are you better off or worse off for
having the national chains in business? Is the error rate
better or worse compared to self-prepared returns using the
leading software? When the IRS eliminated Tele-file, they
surely drove a certain non-trivial number of people into the
hands of the paid preparers, what was that all about?

-Mark Bole



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A GAO study of the IRS itself finds about a 2/3rds accuracy
rate:

http://moneycentral.msn.com/content/...ps/P105690.asp

First, the tax code is immensely complex.
Second, the best and brightest dont flock to drone IRS or
tax preparer jobs. (I am not saying all preparers are below
average. The field also attracts geeks who revel in the
complexity.)

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