"Tax preparers should be required to provide a clear, simple disclosure of tax preparation fees to consumers before beginning the process of tax preparation".
However, this comfortable industry, with its mass of captive customers, is due for a shake-up, thanks to digital technology and regulatory change.Most assisted returns are done by small "mom-and-pop" tax preparers.
Mistakes are indeed common, but Dan Alban of the Institute for Justice, a libertarian outfit which is supporting the plaintiffs, says that the real problem is not dozy small tax preparers but the complexity of the tax code itself.
For years, tax preparers (both H&R Block and the mom-and-pop shops) offered loans against this money, earning themselves a tidy revenue stream.
But increased federal scrutiny of such loans has caused several banks to quit their partnerships with the tax preparers.
Last year, the IRS issued a rule requiring most tax preparers (those who are not certified public accountants, lawyers or otherwise exempted) to take a test certifying their skills, and thereafter, 15 hours of "continuing education" annually.H&R Block supported the change; it already has in-house training programmes.
The big-brand preparers make lots of mistakes, too, according to the Government Accountability Office, an official watchdog.
But it never will, so most taxpayers hire a guide.In this section Fashion forward Golden fleeces Guides through the swamp Prometheus unsound Shut your kale-hole Strong deliverer From lumps to lager Asian innovation ReprintsTax advisers and preparers benefit handsomely from politicians' addiction to loopholes and unclear English.
Scott Schneeberger, an analyst at Oppenheimer, a research and investment firm, guesses that as many as a fifth of the 100,000 independent preparers may quit the industry between 2011 and 2012.
Most of us, though, would likely reject the IRS effort and still file our own returns using software or tax preparers.
A flat tax also would eliminate virtually all compliance costs (e.g., monies paid to professional tax preparers) and reduce red tape significantly.
