IRS Fines Tax Preparers $2.4M, But Doesn’t Collect

The Internal Revenue Service has fined tax preparers over $2.4 million in the past two years, but has collected only a fraction of that amount, according to congressional auditors.

The General Accounting Office (GAO) said IRS collected just $291,000, or 12 percent of the penalties due. Less than half of the penalized preparers paid any fine at all.

According to The Washington Post, tax officials told GAO that "they cannot afford to make these low-dollar paid-preparer cases a priority given their responsibility for addressing billions of dollars in uncollected taxes."

The Senate Finance Committee disagrees with the IRS priorities, considering that more than half the people filing tax returns use paid preparers.

"Clearly people benefit from paid preparers, but there are some bad apples in the bunch," said Sen. Charles E. Grassley (R-Iowa), the committee chairman. "The IRS and Congress need to do more to make sure the bad apples are tossed out of the basket."

In 2001, more than 72 million taxpayers used paid preparers. If even a small percentage of them get bad advice, millions may be ill served, GAO said.

You may like these other stories...

Accounting group pushes back against retirement age scrutinyMichael Rapoport of the Wall Street Journal reported that the American Institute of CPAs (AICPA) on Monday pushed back against federal regulators who are again...
There's still time to take advantage of last-minute, tax-saving moves for dependency exemptions. For 2014, there are bigger dependency exemptions, as well as rules that, in some cases, are dauntingly complex.The 2014...
Tesco accounting probe finds “inappropriate behavior” by staff – reportsClare Hutchison of Reuters wrote on Sunday that an investigation into a 250 million-pound ($402 million) profit overstatement at...

Already a member? log in here.

Upcoming CPE Webinars

Oct 22This webinar will include discussions of important issues in AU-C 800, Audits of Financial Statements Prepared in Accordance with Special Purpose Frameworks.
Oct 23Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.
Oct 30Many Excel users have a love-hate relationship with workbook links.
Nov 5Join CPA thought leader and peer reviewer Rob Cameron and learn ways to improve the outcome of your peer reviews while maximizing the value of your engagement workflow.