What happened to the RTRP?

What does the RTRP, an IRS Lawsuit, and the Annual Filing Season Program have to do with tax preparer continuing education?

History of the RTRP Registered Tax Return Preparer Program

Based on a review led by IRS Commissioner Doug Shulman in 2009, the Internal Revenue Service announced January of 2010 that it would increase standards for return preparers with a new initiative called the Registered Tax Return Preparer (RTRP) program. The initiative mandated all tax return preparers register with the IRS and obtain a Preparer Tax Identification Number (PTIN). The RTRP program also stipulated that all non-exempt preparers pass a competency test, completing 15 hours of continuing education credits each year.

Certified Public Accountants, attorneys and Enrolled Agents were exempt from the testing and CE requirements. It was deemed these exempt individuals exceeded minimal requirements due to the testing and education needed to their credentials and licenses. Also exempt from the program were “non-1040” tax return preparers and “non-signing” preparers who were supervised by CPAs, attorneys or Enrolled Agents i.e. firms 80 percent owned by CPAs, attorneys and Enrolled Agents. Tax preparation volunteers that prepared returns without fee were exempt from all initiative provisions as well. The IRS plans allowed preparers who tested during the initial three-year implementation period to sit as many exams as they needed in order to pass provided they pay for the examinations.

The IRS developed a searchable online directory of tax return preparers that registered and passed the competency examination. The online directory allowed the general public to see whether a preparer had taken appropriate tests and had registered with the IRS. The online Directory of Federal Tax Return Preparers with Credentials and Select Qualifications is still in use today and allows the public to search the IRS database for tax preparers with the following credentials or qualifications:

  • Attorney Credential
  • Certified Public Accountant Credential
  • Enrolled Agent Credential
  • Enrolled Actuary Credential
  • Enrolled Retirement Plan Agent Credential
  • Annual Filing Season Program Participant

The RTRP stipulated that first time tax preparers pay $64.25 to register for a Preparer Tax Identification Number (PTIN). Existing preparers that already had a PTIN number assigned were required to register under the new program paying $63 each year for the renewal.

Prometric administered the RTRP competency exams for the IRS. The test consisted of 120 questions with multiple choice and true / false questions. Test takers had 2.5 hours to complete the entire RTRP exam. The fee to take the exam was $116 whether you passed or failed. The test was considered an open book in the sense that Prometric provided individuals with Publication 17, Form 1040 and Form 1040 instructions as reference materials during the exam.

Fast Forward Academy's RTRP Course Outline & Exam Specifications

The IRS has released specifications for the IRS Registered Tax Return Preparer (RTRP) competency test in conjunction with Prometric. The details of the IRS specification are listed below for your reference. The IRS has designed the RTRP basic preparer competency exam to cover ethical responsibilities, Form 1040 series, and related schedules and forms. The topics below are not set in stone and served as a general outline of potential topics on the IRS RTRP exam. Tax preparers were required to pass the exam in order to achieve the title Registered Tax Return Preparer (RTRP).

The IRS has released specifications for the IRS Registered Tax Return Preparer (RTRP) competency test in conjunction with Prometric.

RIP RTRP? End of the RTRP

On January 18th, 2013, the United States District Court for the District of Columbia ruled in favor of plaintiffs permanently enjoining the Internal Revenue Service from enforcing the regulatory requirements for registered tax return preparers. In accordance with the order, tax return preparers covered by this program were no longer required to register with the IRS, to complete competency testing or secure continuing education. The ruling did not affect the regulatory practice requirements for CPAs, attorneys, Enrolled Agents, Enrolled Retirement Plan Agents or Enrolled Actuaries. Essentially the court ruled that the IRS lacked authority from Congress to regulate tax preparers and as such was no longer able to enforce the mandates set forth by the Registered Tax Preparer Program.

Launch of the IRS Preparer Directory Directory of Federal Tax Return Preparers

On February 5th, 2015, the Internal Revenue Service rolled out the Directory of Federal Tax Return Preparers. The purpose of the directory was to give the general public a way to research tax return preparers in their area and determine the type of credentials or qualifications held by a specific tax professional. It is important to note that not every tax return preparer is represented in the directory. The directory contains only those with a PTIN who hold a professional credential that opted in, and or have obtained an Annual Filing Season Program Record of Completion from the IRS. The directory includes some search, and sort features which allow someone to locate practitioners by name, city, state and zip code as well as pertinent licence, credential, or certificate.

Voluntary AFSP Annual Filing Season Program

The Annual Filing Season Program was developed to acknowledge efforts of non-credentialed return preparers that aim for a higher level of professionalism. Individuals that participate in the AFSP can meet specific requirements by obtaining 18 hours of continuing education, including a six hour federal tax law refresher course with an exam. The return preparer must also renew their preparer tax identification number (PTIN) for the upcoming year and consent to adhere to the obligations in Circular 230, Subpart B and section 10.51.

Upon completion of these requirements, return preparers receive an Annual Filing Season Program Record of Completion from the IRS.

Already passed the RTRP? Past RTRP Participants

Those who passed the Registered Tax Return Preparer test and certain other recognized national and state tests are exempt from the six hour federal tax law refresher course with an exam and only need 15 hours of continuing education each year to obtain an Annual Filing Season Program Record of Completion.

*Please Note: Exempt individuals (including former Registered Tax Return Preparers) must also consent to the Circular 230 obligations to officially participate in the Annual Filing Season Program. View the video on the right side of this page for a demonstration.