I 
117TH CONGRESS 
1ST SESSION H. R. 4184 
To set minimum standards for tax return preparers. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 25, 2021 
Mr. PANETTA (for himself and Mr. RICE of South Carolina) introduced the 
following bill; which was referred to the Committee on Ways and Means 
A BILL 
To set minimum standards for tax return preparers. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Taxpayer Protection 
and Preparer Proficiency Act of 2021’’. 
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— 
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‘‘(A) the practice of representatives of per-
sons 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’’; and 
(C) by inserting ‘‘or in preparing their tax 
returns, claims for refund, or documents in con-
nection with tax returns or claims for refund’’ 
after ‘‘cases’’ in subparagraph (D). 
(b) AUTHORITY TO SANCTION REGULATED TAX RE-
TURN 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 ‘‘mis-
leads or threatens— 
‘‘(A) any person being represented or any 
prospective person being represented; or 
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‘‘(B) any person or prospective person 
whose tax return, claim for refund, or document 
in connection with a tax return or claim for re-
fund, 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 fol-
lowing new subsection: 
‘‘(f) 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 Inter-
nal Revenue Code of 1986; 
‘‘(B) satisfying any examination and an-
nual continuing education requirements as pre-
scribed by the Secretary; and 
‘‘(C) completing a background check ad-
ministered by the Secretary. 
‘‘(2) EXEMPTION.—The Secretary shall exempt 
tax return preparers who have been subject to com-
parable examination, continuing education require-
ments, and background checks administered by the 
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Secretary or any comparable State licensing pro-
gram. Such exemption shall extend directly to indi-
viduals who are supervised by such preparers and 
are not required to secure an identification number 
under section 6109(a)(4). 
‘‘(3) REINSTATEMENT OF REGISTERED TAX RE-
TURN
PREPARER
PROGRAM.—The Secretary shall 
issue regulations under this section reinstating the 
Registered Tax Return Preparer Program. Examina-
tion of tax return prepares under such program shall 
be limited to a one-time, basic individual income tax 
examination and the annual continuing education re-
quirement under such program shall not exceed 15 
hours.’’. 
(d) TAX RETURN PREPARER DEFINED.—Section 
330 of title 31, United States Code, as amended by sub-
section (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 pre-
parer’ has the meaning given such term under sec-
tion 7701(a)(36) of the Internal Revenue Code of 
1986. 
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‘‘(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 sec-
tion 6696(e)(2) of such Code.’’. 
(e) AMENDMENTS WITH RESPECT TO IDENTIFYING 
NUMBER.— 
(1) IN GENERAL.—Section 6109(a) of the In-
ternal Revenue Code of 1986 is amended by striking 
paragraph (4) and inserting the following: 
‘‘(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 em-
ployer, or both, as may be prescribed. For pur-
poses of this paragraph, the terms ‘return’ and 
‘claim for refund’ have the respective meanings 
given to such terms by section 6696(e). 
‘‘(B) 
EXCEPTION.—Subparagraph 
(A) 
shall not apply with respect to the preparation 
of any return or claim for refund by a tax re-
turn preparer if— 
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‘‘(i) such return or claim is prepared 
by such preparer while such preparer is 
employed by an attorney, certified public 
accountant, or enrolled agent firm, and 
‘‘(ii) such preparer prepares such re-
turn or claim under the supervision and di-
rection of a tax return preparer who signs 
such return or claim and is an attorney, 
certified public accountant, or enrolled 
agent.’’. 
(2) CLARIFICATION
OF
RESCISSION
AUTHOR-
ITY.—Section 6109 of such Code is amended by in-
serting after subsection (d) the following new sub-
section: 
‘‘(e) AUTHORITY TO RESCIND IDENTIFYING NUM-
BER 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 incom-
petent or disreputable (as such terms are used 
in subsection (c) of section 330 of title 31, 
United States Code); and 
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‘‘(B) rescinding the identifying number 
would promote compliance with the require-
ments of this title and effective tax administra-
tion. 
‘‘(2) RECORDS.—If an identifying number is re-
scinded under paragraph (1), the Secretary shall 
place in the file in the Office of the Director of Pro-
fessional Responsibility the opinion of the Secretary 
with respect to the determination, including— 
‘‘(A) a statement of the facts and cir-
cumstances relating to the determination; and 
‘‘(B) the reasons for the rescission.’’. 
(f) GAO STUDY AND REPORT ON THE EXCHANGE 
OF INFORMATION BETWEEN THE IRS AND STATE TAX-
ATION AUTHORITIES.— 
(1) IN GENERAL.—Not later than 18 months 
after the date of the enactment of this Act, the 
Comptroller General shall conduct a study and sub-
mit to Congress a report on the sharing of informa-
tion between the Secretary of the Treasury and 
State authorities, as authorized under section 
6103(d) of the Internal Revenue Code of 1986, re-
garding identification numbers issued to paid tax re-
turn preparers and return preparer minimum stand-
ards. 
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(2) INCREASED INFORMATION SHARING.—The 
study and report described in paragraph (1) shall in-
clude an analysis of the impact that increased infor-
mation sharing between Federal and State authori-
ties would have on efforts to enforce minimum 
standards on paid tax return preparers. 
Æ 
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