By Andy Frye
In the tax preparation business, we need another rule to follow like we need a hole in the head. That is to say, we don’t need it. We are already loaded down with more rules than we can carry in our perpetually-overloaded brains.
For this reason, many CTEC tax preparers are wondering whether they really need to obtain this IRS Annual Filing Season Program (AFSP) credential, and many CTEC tax preparers have chosen to completely blow off the AFSP as an unnecessary set of letters that isn’t mandatory, doesn’t provide you with any real value, and isn’t worth getting.
The statistics suggest that tax preparers nationwide have been pretty underwhelmed by this credential’s value. Only 62,000 out of 400,000+ preparers chose to get the AFSP credential for 2016. That’s only 15 percent adoption rate.
CTEC tax preparers should be careful of taking the AFSP credential too lightly, however, and let me tell you why…
CTEC Tax Preparer Barred from Checking Status of Refund for Client Because No AFSP
We got a call a week ago on our Tax Education Hotline that oriented me to the reality that not having the AFSP credential in place can in fact be a problem for many CTEC tax preparers.
The caller, a CTEC tax preparer in the Los Angeles area, told me about how she had called the IRS to check the status of a delayed refund for her client. And the IRS wouldn’t give her any information, because she didn’t have the AFSP letters next to her name. I had thought that IRS would at least partially respect the “check box” that appears on the tax return saying that the preparer has authority to discuss return with IRS.
But I guess not.
I knew that with no AFSP credential CTEC tax preparers would be prevented from “representing” clients before the IRS, but I didn’t know that IRS would consider just getting information about a delayed refund a “representation” job. I guess it is like that though. The IRS agent explained that even if she had a signed 8821 from the taxpayer, she could not get ANY information about the client.
This tax preparer was very upset and of course she wanted to know if our CTEC course would also help her get the AFSP credential so that she was never humiliated like that ever again. I told her that, as long as you’re a CTEC preparer, our course satisifes both CTEC and IRS AFSP hours and so it turned out it was an easy sale for us.
Benefits of IRS AFSP Credential Appear Minimal–But Are They?
Everybody knows that tax preparers have a skeptical streak. We’re not interested in being BS’ed. We get enough of that from our clients and the general public so we’re not looking for any extra from you! 🙂
Therefore, I don’t see too many CTEC tax preparers who are jumping out of their chairs trying to be a part of this IRS AFSP Database that the public is supposedly going to use to select their tax preparer based on the amount of continuing education we’ve done.
Indeed, I’m not sure any member of the public has ever even used that database.
The second benefit of getting the AFSP after your name–you can represent your clients with the IRS–also appears, well, not very appealing to many CTEC preparers. Many CTEC preparers assume that “representing your clients” means representing a client at an audit. And many CTEC preparers don’t do that kind of work and don’t want to do that kind of work…so it’s no loss if they lose that power…they didn’t want it in the first place.
Add in the fact that AFSP is completely optional and you can see why so many CTEC preparers have not chosen to bother with it.
But once you realize that “representing” your client could mean something as simple as calling the IRS to check on the status of a delayed refund, and you can’t even do that without an AFSP credential, the necessity of the AFSP may change in your eyes.
As we all know, our clients rely on us these days not to just fill out forms, but to stand behind them and with them if they need additional help.
Not having the AFSP, it appears, can cripple your ability to do that.
Also worth noting, you need AFSP for both the current year and the year of the tax return you’re discussing with IRS, or else IRS will not talk to you…and by “not talk to you,” I mean, like, seriously, not talk to you.
Good News: AFSP Is Super-Easy for CTEC Preparers
Lest you think this post is all bad news, the good news is that it is so, so super-easy for CTEC preparers to get the AFSP credential.
Unlike preparers in states that have no no education or registration requirements (savages), CTEC preparers don’t need to take any test or do anything “extra” on the education side to qualify for AFSP. CTEC tax preparers can just do your normal 20 hours CTEC and as long as you choose a course (such as ours) that meets both CTEC and AFSP requirements, you can kill two birds with one stone, and get the AFSP in place very easily.
We have full directions of how to get the AFSP included in our Renew CTEC course so that there is no more confusion about the process.
I will admit though, I myself was confused about why the AFSP even matters to our Renew CTEC Members. But after hearing that “horror story” about a fellow tax professional not even being able to check her own client’s refund status, I’m not confused anymore. Every CTEC preparer who doesn’t want to be effectively severed from your client if there ever is a problem with IRS should get the AFSP ASAP.
The fact that it’s so easy to get makes it even more of a no-brainer.
Kill two birds with one stone and get your CTEC mandatory hours at the same you get your AFSP-compliant education in one online course so that you’re never cut off from your client if your client needs you–that’s my humble advice.