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Reps. Black, Meehan Introduce Legislation to Protect Taxpayers, Combat Fraud

Dec 1, 2015 Issues: Tax Reform

Washington, DC – Today, Congressman Diane Black (R-TN-06) and Congressman Pat Meehan (R-PA-07) introduced H.R. 4141, the Tax Return Preparer Competency Act. The legislation requires professional tax return preparers to undergo necessary examinations, take annual continuing education classes and to submit to a background check. Introduction of the bill follows the release of the IRS’s “Dirty Dozen” list of tax scams for 2015, which warns of “dishonest preparers who set up shop each filing season to perpetrate refund fraud, identity theft and other scams that hurt taxpayers.”

Tax preparer fraud raises particular concerns for the earned income tax credit (EITC). A Treasury Inspector General for Tax Administration (TIGTA) report found that the IRS may have issued more than $15 billion in improper EITC payments in 2013 alone. The National Taxpayer Advocate estimated that more than 76 percent of preparers who prepared returns claiming the EITC did not have a professional credential.

Black and Meehan released the following statements:

“As a result of our mammoth tax code, an estimated 80 million Americans turn to tax preparers to assist in filing their yearly returns. Today, however, there are no minimum standards to stipulate who can charge for these services. This lack of accountability puts Americans at unnecessary risk and contributes to rampant improper payments within the tax system. While Congress continues working towards a fairer, flatter, simpler tax code that will enable more Americans to complete their taxes on their own, we must also act now to rid out fraud and protect taxpayers from fly-by-night tax preparers who lack a basic background check and the requisite training to handle Americans’ most sensitive information,” said Congressman Diane Black.

“A tax burden can dramatically affect a family’s take-home income each month, and Americans take the annual tax preparation process seriously. The complexity of the tax code means that many of these families will use the services of a tax preparer to help them ensure they pay only what they owe. When they do that, they turn over a vast amount of their families’ most personal data. They put their trust not only in the tax preparer’s competence – but in its honesty and integrity, as well. They deserve to know their information is safe. This bill is a prudent measure to weed out scam artists and help protect taxpayers from identity theft and fraud,” said Congressman Pat Meehan.

Bill Text: H.R. 4141, the Tax Return Preparer Competency Act

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Congressman Diane Black represents Tennessee’s 6th Congressional District. She has been a registered nurse for more than 40 years and serves on the House Ways and Means and Budget Committees