Tax-preparer Enforcement, Accountability, and Minimum Standards Act or the TEAMS Act
This bill authorizes the Department of the Treasury to regulate tax return preparers, including by sanctioning preparers for incompetence and disreputable behavior and by establishing minimum competency standards for preparers.
[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3737 Introduced in House (IH)]
<DOC>
117th CONGRESS
1st Session
H. R. 3737
To establish minimum competency standards for tax return preparers, and
for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
June 4, 2021
Mr. Vela introduced the following bill; which was referred to the
Committee on Ways and Means
_______________________________________________________________________
A BILL
To establish minimum competency standards for 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-preparer Enforcement,
Accountability, and Minimum Standards Act'' or the ``TEAMS Act''.
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'';
(C) in subparagraph (C), by inserting ``and minimum
competency standards'' after ``necessary
qualifications''; and
(D) in subparagraph (D), by striking the period at
the end and inserting ``or in preparing their tax
returns, claims for refund, or documents in connection
with tax returns or claims for refund.''.
(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) Minimum Competency Standards for 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 continuing
education requirements as prescribed by the Secretary,
including--
``(i) holding a high school diploma or
passing an equivalency exam;
``(ii) completing 30 hours of tax
preparation training (or work deemed
equivalent);
``(iii) passing a tax preparation exam with
a score of 70 percent or greater every 5 years;
and
``(iv) completing 15 hours of continuing
education every 2 years; and
``(C) completing a background check administered by
the Secretary which does not return any felony
convictions.
``(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) of the
Internal Revenue Code of 1986.''.
(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.--Paragraph (4) of section 6109(a) of the
Internal Revenue Code of 1986 is amended to read as follows:
``(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 in section 6696(e).
``(B) Exception.--Subparagraph (A) shall not apply
to any tax return preparer who prepares a return or
claim for refund under the supervision and direction of
a tax return preparer who signs the return or claim for
refund and is a certified public accountant, an
attorney 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.''.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
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