[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1983 Introduced in House (IH)]
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119th CONGRESS
1st Session
H. R. 1983
To amend title 31, United States Code, to direct the Secretary of the
Treasury to regulate tax return preparers, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 10, 2025
Mr. Cohen introduced the following bill; which was referred to the
Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend title 31, United States Code, to direct the Secretary of the
Treasury to regulate tax return preparers, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Tax Return Preparer Accountability
Act of 2025''.
SEC. 2. REGULATION OF TAX RETURN PREPARERS.
(a) In General.--Subsection (a) of section 330 of title 31, United
States Code, is amended--
(1) by striking paragraph (1) and inserting the following:
``(1) regulate--
``(A) the practice of representatives of persons
before the Department of the Treasury; and
``(B) the practice of tax return preparers; and'';
and
(2) in paragraph (2)--
(A) by inserting ``or a tax return preparer to
prepare tax returns'' after ``practice'';
(B) by inserting ``or tax return preparer'' before
``demonstrate''; and
(C) by inserting ``or in preparing their tax
returns, claims for refund, or documents in connection
with tax returns or claims for refund'' after ``cases''
in subparagraph (D).
(b) Authority To Sanction Regulated Tax Return Preparers.--
Subsection (c) of section 330 of title 31, United States Code, is
amended--
(1) by striking ``before the Department'';
(2) by inserting ``or tax return preparer'' after
``representative'' each place it appears; and
(3) in paragraph (4), by striking ``misleads or threatens''
and all that follows and inserting ``misleads or threatens--
``(A) any person being represented or any
prospective person being represented; or
``(B) any person or prospective person whose tax
return, claim for refund, or document in connection
with a tax return or claim for refund, is being or may
be prepared.''.
(c) Minimum Competency Standards for Tax Return Preparers.--Section
330 of title 31, United States Code, is amended by adding at the end
the following new subsection:
``(f) Tax Return Preparers.--
``(1) In general.--Any tax return preparer shall
demonstrate minimum competency standards under this subsection
by--
``(A) obtaining an identifying number for securing
proper identification of such preparer as described in
section 6109(a)(4) of the Internal Revenue Code of
1986;
``(B) satisfying any examination and annual
continuing education requirements as prescribed by the
Secretary; and
``(C) completing a background check administered by
the Secretary.
``(2) Exemption.--The Secretary shall exempt tax return
preparers who have been subject to comparable examination,
continuing education requirements, and background checks
administered by the Secretary or any comparable State licensing
program. Such exemption shall extend directly to individuals
who are supervised by such preparers and are not required to
secure an identification number under section 6109(a)(4).''.
(d) Tax Return Preparer Defined.--Section 330 of title 31, United
States Code, as amended by subsection (c), is amended by adding at the
end the following new subsection:
``(g) Tax Return Preparer.--For purposes of this section--
``(1) In general.--The term `tax return preparer' has the
meaning given such term under section 7701(a)(36) of the
Internal Revenue Code of 1986.
``(2) Tax return.--The term `tax return' has the meaning
given to the term `return' under section 6696(e)(1) of the
Internal Revenue Code of 1986.
``(3) Claim for refund.--The term `claim for refund' has
the meaning given such term under section 6696(e)(2) of such
Code.''.
(e) Amendments With Respect to Identifying Number.--
(1) In general.--Section 6109(a) of the Internal Revenue
Code of 1986 is amended by striking paragraph (4) and inserting
the following:
``(4) Furnishing identifying number of tax return
preparer.--
``(A) In general.--Any return or claim for refund
prepared by a tax return preparer shall bear such
identifying number for securing proper identification
of such preparer, his employer, or both, as may be
prescribed. For purposes of this paragraph, the terms
`return' and `claim for refund' have the respective
meanings given to such terms by section 6696(e).
``(B) Exception.--Subparagraph (A) shall not apply
with respect to the preparation of any return or claim
for refund by a tax return preparer if--
``(i) such return or claim is prepared by
such preparer while such preparer is employed
by an attorney, certified public accountant, or
enrolled agent firm, and
``(ii) such preparer prepares such return
or claim under the supervision and direction of
a tax return preparer who signs such return or
claim and is an attorney, certified public
accountant, or enrolled agent.''.
(2) Clarification of rescission authority.--Section 6109 of
such Code is amended by inserting after subsection (d) the
following new subsection:
``(e) Authority To Rescind Identifying Number of Tax Return
Preparer.--
``(1) In general.--The Secretary may rescind an identifying
number issued under subsection (a)(4) if--
``(A) after notice and opportunity for a hearing,
the preparer is shown to be incompetent or disreputable
(as such terms are used in subsection (c) of section
330 of title 31, United States Code); and
``(B) rescinding the identifying number would
promote compliance with the requirements of this title
and effective tax administration.
``(2) Records.--If an identifying number is rescinded under
paragraph (1), the Secretary shall place in the file in the
Office of the Director of Professional Responsibility the
opinion of the Secretary with respect to the determination,
including--
``(A) a statement of the facts and circumstances
relating to the determination; and
``(B) the reasons for the rescission.''.
(3) Effective date.--The amendments made by this subsection
shall apply to returns filed after the date of the enactment of
this Act.
SEC. 3. TECHNOLOGY UPDATES AT INTERNAL REVENUE SERVICE.
(a) Implementation of Automated Formula To Identify Taxpayers at
Risk of Economic Hardship.--As soon as practicable, the Secretary of
the Treasury (or the Secretary's delegate), shall implement at the
Internal Revenue Service an algorithm that will enable the Internal
Revenue Service to--
(1) identify taxpayers at high risk of economic hardship
(as defined by the Secretary in regulations),
(2) ask questions of taxpayers who contact the Internal
Revenue Service regarding a balance due for purposes of
identifying those at risk of hardship,
(3) in the case of taxpayers at risk of economic hardship
who seek to enter into streamlined installment agreements
online, to notify such taxpayers of the resources available to
them,
(4) determine whether to exclude taxpayers' debts from
automated collection treatments such as the Federal Payment
Levy Program, the private debt collection program, and passport
certification, and
(5) rank cases for collection priority.
(b) Security Standards for Tax Software.--The Secretary of the
Treasury (or the Secretary's delegate), shall--
(1) as soon as practicable, promulgate such regulations and
guidance as are necessary to prescribe information security
standards for all tax software providers, and
(2) annually thereafter, review and update such standards.
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