Tax Lawyer's Blog

We simply must bring this debate to a conclusion for I can no longer bear the encomiums.

When a miraculously talented blogger like Joe Kristan opens a rebuttal to one of your blog posts by telling the world how “fine” and “excellent” you are, you’d better learn to pucker.

Of course I did call Joe a “highly regarded” blogger, but that was only because it’s true.

Because someone has to start the shutting-up (it rarely happens naturally, especially with bloggers), I hereby declare this post to be my last word on the subject of tax preparer licensing, but even as I do so I know that I am probably lying.

In a prior post I made the argument that we should regulate unlicensed tax preparers to level the playing field between them and already regulated preparers (CPAs, Lawyers and IRS Enrolled Agents).

Joe took exception to this and responded in a blog post titled Level Playing Fields?

The playing fields are bumpy already. While lawyers have to keep up a certain level of CPE and so on, that can be gamed. One of the most popular schools for lawyers in Iowa is the year-end bar association tax school held at the Marriot. It is popular because it provides lots of CLE in December, when the lawyers are running up against their deadline. It is also popular because it is broadcast closed-circuit in the hotel, so the lawyers can get their CLE without ever leaving their rooms. So the lawyers can do client work, or party, or sleep in, and still get their CLE. Most lawyers take their CPE seriously, but it would be astounding if everyone did. If lawyers can game CPE so easily, how hard could it be for a much larger cohort of licensed preparers?

I am offended.

I would never lounge in a hotel room to get my CPE training. I always sit at the back of the classroom with a hot cup of Java and the Sports page.

Joe, of course, is correct when he says that some already regulated lawyers and CPAs don’t take their CPE requirements seriously and merely go through the motions in order to get the credits.

But is this enough to throw the baby out with the dingy bath water?

One could just as easily argue (I am not) that we should beef up the current regulatory scheme to ensure that people stop gaming it rather than ditch it altogether.

If we ditched all of the regulatory schemes that some people “gamed,” we’d have no government at all because all are to some extent gamed.

(That wasn’t an applause line, Joe.)

I think Joe is saying that he opposes regulation and licensing not as a concept, but because he believes it doesn’t work and that government is incapable of making it work.

(If I have mistated Joe’s position here I have no doubt he will correct me forthwith in yet another blog post prefaced by a declaration of my abject wonderfulness.)

The truth is it’s hard to argue with him on this (I’ll find a way) because I am a long-time believer that in most things the mega-bureaucracy is inefficient and wasteful.

But because I oppose big government doesn’t mean I propose no government. There are some things government must do and I think this is one of them.

In the 20 plus years of my practice, both as a CPA and a tax attorney, I have had hundreds of clients hire me to fix problems caused by unlicensed tax preparers. 

Some of these unlicensed preparers intentionally manufactured fake job expenses or fake Schedule “C” expenses. Others even more egregiously concocted entire schemes like the infamous Slavery Reparations Credit.

Again, I am not suggesting a complex regulatory regime but, rather, a simple system (Joe says the ones that start simple end up complex), where the government knows who the tax preparers are and the tax preparers know (or at least suspect) that Big Brother is watching them.

Is that such a big deal?

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