The Internal Revenue Service Lacks a Coordinated Strategy to Address Unregulated Return Preparer Misconduct

The Deputy Commissioner for Services and Enforcement should request the Commissioner, Small Business/Self-Employed (SB/SE) Division, and the Director, RPO, to develop a compliance strategy that allows for the imposition of the I.R.C. section 6695(c) penalty on return preparers who routinely fail to supply their PTINs on tax returns they have prepared (upon such thresholds that are deemed appropriate).

The Commissioner, Small Business/Self-Employed (SB/SE) Division, should consider expanding use of the PRISM feature of the Return Preparer Database to assist the LDCs and the Examination function, and with the identification and development of the PACs.

The Director, RPO, should revise the letters informing tax return preparers that they are not in tax compliance to include language that the IRS has previously provided the details about the alleged noncompliance.

The Director, RPO, should when credentials checks identify a return preparer who is misrepresenting professional status, refer the case to TIGTA's Office of Investigations for possible investigation.