2019 Legislative Update: Permit Requirements for Tax Preparers and Facilitators
Paid tax preparers who prepare more than 10 Connecticut income tax returns or more than 10 federal income tax returns for Connecticut clients, or a combination of both, or who facilitate refund anticipation loans or refund anticipation checks, must obtain a permit issued by the Department of Revenue Services (DRS). Certain professions already licensed and/or regulated - such as accountants, attorneys, and enrolled agents - are exempt from this permit requirement.
In order to obtain a permit, an individual must meet certain basic qualifications, including having an Internal Revenue Service (IRS) preparer tax identification number (PTIN) and evidence of experience, education, or training in tax preparation services.
Legislation (Public Act 19-186 § 7) enacted in June modified certain statutory provisions, including:
- All applicants were previously required by January 1, 2020, to supply a certificate of completion of the annual filing season program administered by the IRS in order to receive or renew a DRS permit. The effective date for this requirement was changed to January 1, 2022.
- Clarification that the "experience, education or training in tax preparation services" only applies to tax preparers who are required to register.
- Clarification that an IRS qualified tax preparer is exempt from the permit requirement only if the preparer is a volunteer tax preparer sponsored by a volunteer organization such as the Tax Counseling for the Elderly program and the Volunteer Tax Assistance program.
- Clarification that a permit that has been placed in inactive status based on the tax preparer's request, can be reactivated for a reduced fee, as long as reactivation is requested before the expiration date.
Those who may need to register should visit the DRS website's Paid Preparers and Facilitators page, where users are prompted to answer questions to determine permit applicability.
DRS accepts permit applications online only through the State of Connecticut eLicense web portal at https://www.elicense.ct.gov/. The initial permit application fee is $100.00 and is valid for a period of two years from the date of application.
Since the registration requirement was launched in October 2018, DRS has certified more than 1,700 permit applications.