SEC. 202. REGULATION OF FEDERAL INCOME TAX RETURN 
PREPARERS. 
(a) IN GENERAL.—Section 330(a)(1) of title 31, 
United States Code, is amended by inserting ‘‘(including 
tax return preparers of Federal tax returns, documents, 
and other submissions)’’ after ‘‘representatives’’. 
(b) PROMULGATION
OF REGULATIONS.—The Sec-
retary of the Treasury shall prescribe regulations under 
section 330 of title 31, United States Code, to regulate 
any tax return preparers not otherwise regulated by the 
Secretary. 
(c) REQUIREMENTS.—Such regulations shall provide 
guidance on the following: 
(1) EXAMINATION.— 
(A) IN
GENERAL.—In promulgating the 
regulations under paragraph (1), the Secretary 
shall approve and oversee eligibility examina-
tions. 
(B) TWO
EXAMINATIONS.—One such ex-
amination shall be designed to test technical 
knowledge and competency to prepare indi-
vidual returns, and the other examination shall 
be designed to test technical knowledge and 
competency to prepare business income tax re-
turns. 
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(C) EITC.—The examination relating to 
individual returns shall test knowledge and 
competency regarding properly claiming the 
earned income tax credit under section 32 of 
the Internal Revenue Code of 1986. 
(D) ETHICS.—Both examinations under 
subparagraph (B) shall test knowledge regard-
ing such ethical standards for the preparation 
of such returns as determined appropriate by 
the Secretary. 
(E) GRANDFATHER.—The Secretary is au-
thorized to accept an individual as meeting the 
eligibility examination requirement of this sec-
tion if, in lieu of the eligibility examination 
under this section, the individual passed a State 
licensing or State registration program eligi-
bility examination that the Secretary deter-
mines is comparable to either of the eligibility 
examinations described in subparagraph (B) if 
such exam is administered within 5 years after 
the date of the issuance of the regulations 
under this section. 
(2) SUITABILITY
STANDARDS.—The Secretary 
shall provide suitability standards for practicing as 
a tax return preparer, including tax compliance with 
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the requirements of the Internal Revenue Code of 
1986. 
(3) CONTINUING ELIGIBILITY.— 
(A) IN GENERAL.—The regulations under 
paragraph (1) shall require a renewal of eligi-
bility every 3 years and shall set forth the man-
ner in which a tax return preparer must renew 
such eligibility. 
(B) CONTINUING
PROFESSIONAL
EDU-
CATION
REQUIREMENTS.—As part of the re-
newal of eligibility, such regulations shall re-
quire that each such tax return preparer show 
evidence of completion of such continuing edu-
cation or testing requirements as specified by 
the Secretary. 
(C) NONMONETARY SANCTIONS.— 
(i) The regulations under this section 
shall provide for the denial, suspension or 
termination of such eligibility in the event 
of any failure to comply with the require-
ments promulgated hereunder. 
(ii) Under such regulations, the Sec-
retary shall establish procedures for the 
appeal of any determination under this 
paragraph. 
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