H.F. 2424 Section 1. NEW SECTION . 421.62 Inclusion of preparer tax 1 identification number. 2 1. For purposes of this section: 3 a. “PTIN” means a preparer tax identification number, as 4 defined in Internal Revenue Service Notice 2011-6. 5 b. (1) “Tax return preparer” means any individual who, for 6 a fee or other consideration, prepares ten or more tax returns 7 or claims for refund under chapter 422 during a calendar year, 8 or who assumes final responsibility for completed work on such 9 tax returns or claims for refund under chapter 422 on which 10 preliminary work has been done by another individual. 11 (2) “Tax return preparer” does not include any of the 12 following: 13 (a) A fiduciary of an estate, trust, or individual, while 14 functioning within the fiduciary’s legal duty and authority 15 with respect to that individual, or that estate or trust or its 16 testator, trustor, grantor, or beneficiaries. 17 (b) An individual who prepares the tax returns of 18 the individual’s employer, while functioning within the 19 individual’s scope of employment with the employer. 20 (c) An individual employed by a local, state, or federal 21 government agency, while functioning within the individual’s 22 scope of employment with the government agency. 23 (d) An employee of a person described in subparagraph (1), 24 if the employee provides only clerical or other comparable 25 services and does not sign tax returns. 26 2. On or after January 1, 2019, a tax return preparer is 27 required to include the tax return preparer’s PTIN on any tax 28 return or claim for refund prepared by the tax return preparer 29 and filed under chapter 422. 30 3. The department of revenue shall draft relevant tax return 31 forms to provide the space necessary for a tax return preparer 32 to include a PTIN. 33 Sec. 2. NEW SECTION . 542A.1 Definitions. 34 For purposes of this chapter and unless otherwise required 35 -1- LSB 5649HV (2) 87 mm/jh 1/ 4

H.F. 2424 by the context: 1 1. “Board” means the Iowa accountancy examining board 2 created in chapter 542. 3 2. “PTIN” means the same as defined in section 421.62. 4 3. a. “Uncredentialed tax return preparer” means any 5 individual who, for a fee or other consideration, prepares ten 6 or more tax returns or claims for refund under chapter 422 7 during a calendar year, or who assumes final responsibility for 8 completed work on such tax returns or claims for refund under 9 chapter 422 on which preliminary work has been done by another 10 individual. 11 b. “Uncredentialed tax return preparer” does not include any 12 of the following: 13 (1) An individual licensed as a certified public accountant 14 under chapter 542 or a similar law of another state. 15 (2) An individual admitted to practice law in this state or 16 another state. 17 (3) An enrolled agent enrolled to practice before the 18 federal internal revenue service pursuant to 31 C.F.R. §10.4. 19 (4) A fiduciary of an estate, trust, or individual, while 20 functioning within the fiduciary’s legal duty and authority 21 with respect to that individual, or that estate or trust or its 22 testator, trustor, grantor, or beneficiaries. 23 (5) An individual who prepares the tax returns of 24 the individual’s employer, while functioning within the 25 individual’s scope of employment with the employer. 26 (6) An individual employed by a local, state, or federal 27 government agency, while functioning within the individual’s 28 scope of employment with the government agency. 29 (7) An employee of a person described in paragraph “a” , 30 if the employee provides only clerical or other comparable 31 services and does not sign tax returns. 32 Sec. 3. NEW SECTION . 542A.2 PTIN registration —— continuing 33 education —— annual reporting. 34 On or after January 1, 2019, an uncredentialed tax return 35 -2- LSB 5649HV (2) 87 mm/jh 2/ 4

H.F. 2424 preparer shall not, for a fee or other consideration, prepare 1 ten or more tax returns during a calendar year, or assume 2 final responsibility for completed work on such tax returns on 3 which preliminary work has been done by another individual, 4 unless the uncredentialed tax return preparer does all of the 5 following: 6 1. Registers the uncredentialed tax return preparer’s PTIN 7 with the board, in the manner and form prescribed by the board. 8 The registration shall be updated at least annually. 9 2. Completes a minimum of fifteen hours of continuing 10 education per calendar year, two hours of which shall be on the 11 topic of professional ethics. 12 3. Submits annually to the board a report describing the 13 continuing education completed by the uncredentialed tax 14 return preparer during the calendar year, in the manner and 15 form prescribed by the board. The report shall include, at a 16 minimum, a description of the type, length, and content of each 17 continuing education course completed, and shall include any 18 other information required by the board. 19 EXPLANATION 20 The inclusion of this explanation does not constitute agreement with 21 the explanation’s substance by the members of the general assembly. 22 This bill relates to tax return preparers. On or after 23 January 1, 2019, the bill requires all tax return preparers to 24 include the tax return preparer’s federally issued preparer 25 tax identification number (PTIN) on any tax return or refund 26 claim prepared by the tax return preparer and filed under Code 27 chapter 422, which governs the Iowa individual and corporate 28 income taxes and franchise taxes. 29 The bill defines “tax return preparer” to generally include 30 individuals who prepare 10 or more Iowa tax returns or refund 31 claims in a calendar year. Certain fiduciaries, employees who 32 prepare tax returns of their employers, and other employees are 33 excluded from the definition. 34 On or after January 1, 2019, the bill also requires 35 -3- LSB 5649HV (2) 87 mm/jh 3/ 4

H.F. 2424 uncredentialed tax return preparers to register the 1 uncredentialed tax return preparer’s PTIN with the Iowa 2 accountancy examining board (board); to complete a minimum of 3 15 hours of continuing education per calendar year, two hours 4 of which must be on the topic of professional ethics; and to 5 submit an annual report to the board relating to the continuing 6 education. The bill defines “uncredentialed tax return 7 preparer” to be a tax return preparer (as defined above) who is 8 not a certified public accountant, attorney, or enrolled agent. 9 -4- LSB 5649HV (2) 87 mm/jh 4/ 4