Beware of Who Is Completing Your Individual
Tax Returns and Church Tax Form Filings
It is quickly approaching the time of the year when Pastors will be filing their Income Tax Returns. Most of these will hire an individual or tax firm to complete this process on their behalf. While it is admirable for a Pastor to admit that he or she needs help with their tax returns, it can prove to be dangerous and costly if the preparer is not qualified and certified to do the returns.
Every individual and every organization that prepares individual tax returns for others are required to obtain a Preparer Tax Identification Number (PTIN). This number is to be used in signing the tax returns they prepare for compensation.
The dilemma is that many of these individuals and organizations that have a PTIN were discovered to be non-compliant with IRS tax return preparer guidelines. All tax payers should be leery of any preparer who is not in compliance with IRS regulations.
In a small community in North Carolina was one such individual. The preparer did hundreds of returns for individuals over the course of several years. When the preparer was audited he/she was found to be derelict of proper tax preparation guidelines. This led to audits of the returns which had been prepared and resulted in enormous additional tax liabilities and penalties.
Instead of coming in compliance, after the proverbial “slap on the wrist,” the preparer continued in the error of his/her ways, until finally a poor tax payer was audited and faced possible criminal prosecution for a fraudulent return.
Inspector General for Tax Administration Audit
Recently the Treasury Inspector General for Tax Administration (TIGTA) initiated an audit to determine the effectiveness of the Internal Revenue Service’s processes to ensure that paid tax preparers were meeting the necessary requirements to obtain and renew their PTIN.
The audit revealed that the IRS Return Preparer Office (RPO) did not revoke PTINs from tax preparers who are not compliant with their tax filing and payment obligations. 19,496 were discovered to be non-compliant. Is your tax preparer among them? It was also discovered that these 19,496 preparers had more than $367 million in tax due as of the beginning of the year.
Further investigation by TIGTA uncovered 3,055 preparers who had failed to file required tax returns for one or more tax years. It also revealed 3,001 preparers who self-reported a felony conviction on their application and 87 who reported a crime related to Federal tax matters.
However, it gets worse. TIGTA uncovered that the IRS Return Preparer Office was assigning PTINs to prisoners and individuals who had been barred from preparing tax returns and the PTINs were not revoked.
TIGTA recommended several changes that the IRS should implement immediately. Some were, and some were not.
In A Nutshell
This means that there are many charlatans that are preying on innocent tax payers. Eventually the tax payers will be audited and will be hit with “sticker shock” when the IRS hands them a bill.
Sadly, there are some so-called Church tax experts who fall into this same category. Under the faҫade of being an expert in the Church and Clergy Tax field, they are placing hundreds of Churches and thousands of Ministers at risk of IRS wrath. Why would you want to trust someone or some organization that will not be compliant?
The Name You Can Trust
You can trust Chitwood and Chitwood. The thousands of Churches we represent, the multiplied thousands of Pastors and Ministers, and our 77 years of experience have made us the best in the world.
Every tax preparer and attorney with Chitwood and Chitwood has a legitimate PTIN and we insist they remain compliant – we guarantee it.
Why are you entrusting your Church Tax Form filings or your Minister’s Personal Income Tax Return into the hands of those who may have a dark cloud hanging over their practice. Call us today at 800-344-0076 and let us assign you a genuine certified expert to handle your Ministry and Church tax issues.
Do not trust just anybody – trust the best! With Chitwood and Chitwood it is “A Ministry – Not a Job!”