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SB/SE Agent Seeks Exception for Small Preparers Under Preparer Penalty Guidance

JAN. 13, 2009

SB/SE Agent Seeks Exception for Small Preparers Under Preparer Penalty Guidance

DATED JAN. 13, 2009
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Johnson Regina

 

 

From: Ness John F [John.F.Ness@irs.gov]

 

Sent: Tuesday, January 13, 2009 1:33 PM

 

To: Notice Comments

 

Subject: Notice 2009-5

 

 

We need a small preparer penalty exception to IRC 6694(a). Keep the $250 penalty available for preparers who prepare less than 100 returns.

Revenue Agents in central Indiana often run into small time preparers who are sloppy or no longer keep up with tax law. By and large, they depend on their tax prep software to keep them out of trouble.

In a return preparer case I am working right now, a 6694(a) penalty for $1,000 would be 9% of their net income.

I often am perfectly willing to assess a $250 penalty on a small time, small town preparer to let them know that they are involved in serious business. In some cases, $250 is twice or three times higher than what they charged to prepare the original return.

I have a lot higher threshold to assess the $1,000 penalty.

John Ness

 

Revenue Agent

 

SBSE

 

(317)883-8427
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