Complexify, Confuse and Confiscate ; Tax Return Preparer Regulation Just Another Government Power Grab

Summary

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Sometimes in Washington, politicians try to raise taxes in a straightforward way. They will express shock at the size of the deficit their spending created and attempt to pass tax increases through the Congress - preferably on a "bipartisan" basis to spread the blame around. Other times, the tax hikers are shiftier, demonstrating an enviable guile.

The recent announcement by the Internal Revenue Service (IRS) that it is seeking to regulate "un-enrolled" tax preparers is one of those times. It's a chimera that there is currently no tax return preparation regulation in this country. According to the IRS' own numbers, 70 percent of tax returns were e-filed last year. The remaining 30 percent almost certainly were the last of the diehard taxpayers who do it themselves by hand. Of the e-filed returns, one- third were sent in using do-it-yourself home computer software (the big players here work closely with the IRS already). The rest of the e-filed returns are actual paid preparers. Many of these are already regulated as attorneys, CPAs, and IRS-designated tax experts known as "enrolled agents." Those who are not are mostly trained, seasonal storefront tax preparers at H&R Block, Jackson Hewitt, or Liberty Tax Services (all of whom support this new regulation because they hope to raise fees as a result).

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Extract

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Complexify, Confuse and Confiscate ; Tax Return Preparer Regulation Just Another Government Power Grab

So what's going on here? It certainly looks as if most Americans either prepare their taxes themselves (whether they use paper or software is up to them), or they go to a return preparer wh...

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