REG- Taxpreparer Penalties

CPA Exam Forum REG REG Review REG- Taxpreparer Penalties

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    Posting these topics helps me remember them…

    A taxpreparer must retain records properly. My book says “the tax preparer is required to keep, for 3 years following the last day of the return period, either a copy of the return or claim or a listing of the name and ID of each taxpayer for whom the preparer prepared a return or claim”. The penalty is only $50 per individual for a maximum of $25,000 per return period.

    So if I were a taxpreparer, I would probably just keep a listing electronically…sounds a lot easier! The penalty does not apply to the extent the failure is due to reasonable cause and not due to willful neglect.

    What would be a reasonable cause? Taxpreparer business was burnt down?



    The 3 year period starts the last day of the return period….the 12 month period beginning on July 1 of each year? Why July 1st? If they didn’t specify July 1st, I would have thought April 16th. =( Oh goodness!

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