How to become a registered tax preparer

To become a CTEC registered tax preparer, you must:

• Take a 60-hour qualifying education course from a CTEC approved provider within the past 18 months
• Purchase a $5,000 tax preparer bond from an insurance/surety agent
• Get a Preparer Tax Identification Number (PTIN) from the IRS preparer tax identification number (PTIN)
• Approved Lives Scan
• Register and pay the $33 registration fee online

Annual renewal

You must renew your registration with CTEC annually to legally prepare income tax returns. Visit CTEC for more information.

To renew your CTEC registration, you must:

• Take a minimum of 20 hours continuing education from a CTEC approved provider, which must include:
• 10 hours of federal tax law
• 3 hours of federal tax update
• 2 hours of Ethics and
• 5 hours of California tax law
• Renew your PTIN number with the IRS each year
• Maintain a $5,000 tax preparer bond
• Renew your registration and pay the $33 annual registration before October 31 of each year
• November 1 - January 15 a late fee of $55 will be assessed.

If you fail to renew by January 15, your CTEC registration will be considered expired and you will be subject to the new preparer registration requirements and enforcement penalties for not being in compliance.

Unregistered tax preparer penalty

FTB has the authority to penalize tax preparers not registered with CTEC per R&TC § 19167(d).

Penalties are as follows:

• $2,500 for the first failure to register
• $5,000 for each subsequent failure to register

You have 90 days to comply after receiving notification of the $2,500 penalty issued for your first failure to register with CTEC or not having a valid credential. The penalty will be waived if you provide proof of compliance within 90 days.

The penalty for any subsequent failure is waived only if the CTEC Enforcement team determines the failure is due to reasonable cause.

Some states do require an extra credential to file tax returns. You are responsible for knowing your state’s requirements before you start working as a tax preparer. Some states that currently require an additional credential are as follows:

• California: California Tax Education Council Certification (CTEC)
  
• Connecticut: Connecticut Tax Preparer / Facilitator certification
  
• Maryland: Maryland Tax Preparer Certification
  
• Nevada: Nevada Document Preparation Service Registration
  
• New York: New York Tax Preparer Registration Identification Number (NYTPRIN) Certification
  
• Oregon: Oregon Tax Preparer License
  

Enrolled Agents

You also may choose to become an enrolled agent. Enrolled agents have passed scrutinous tests and are licensed by the IRS with the highest tax credential. Those who become enrolled agents are tax experts and must meet continuing education requirements to maintain their certifications. If you want to become a tax representative you must complete the enrolled agent, CPA, or tax attorney process.