- Golden Corral coming to Cape; may hire 100 workers (7/21/16)9
- Arrest warrants filed for six drug suspects in Cape (7/19/16)6
- Area groups working together to reintroduce elk in Missouri (7/18/16)1
- Suspect in downtown Cape shooting ID'd in court (7/20/16)2
- Prosecutor says shooting by state trooper was justified (7/24/16)14
- Hastings in Cape closing (7/22/16)5
- Governor signs Rep. Swan bill that equalizes child-custody criteria (7/6/16)5
- Jackson's former police dog euthanized Monday (7/21/16)2
- 'I want to see how far I can go' (7/21/16)2
- Southeast Missouri State football players, local police team up for Backstoppers benefit (7/22/16)2
IRS updates rules protecting info taxpayers give preparers
WASHINGTON -- Tax preparers will have to make the fine print a little less fine and obtain customer consent for offshore work under new Internal Revenue Service rules aimed at giving taxpayers more control over their private information.
The final rules issued by the IRS and the Treasury Department on Thursday update regulations from 1974, before the age of electronic filing, that require tax professionals to get informed consent before disclosing tax information to third parties or using it for nonreturn purposes.
The tax agency also announced it was considering preventing tax preparers from using information to sell products such as Refund Anticipation Loans, under which taxpayers, in exchange for instant refunds, have been hit with predatory interest rates.
Consumer groups took issue with the rules when they came out in draft form in 2006, saying they opened the way for preparers to sell information to unrelated marketers and would expose consumers to security risks and identify theft.
The IRS, however, contends there is no change in the basic principle that taxpayers, not the government, should control their own tax information, and that in some cases the taxpayer may need the preparer to share data, for example, when applying for a mortgage loan.
The new rules address issues raised by electronic filing, now the choice of some 57 percent of taxpayers.
They also stipulate that:
* Consent forms must identify the intended purpose of the disclosure and identify the recipients.
* Taxpayers must be told they are not required to sign consents.
* Paper consent documents be in 12-point type on 8-1/2-by-11-inch paper and electronic requests be in the same type so they are easy for taxpayers to read.
* Preparers not repeat consent requests once taxpayers decline to give their consent.
* Consent is needed if tax information is to be disclosed to a tax preparer outside the United States. When tax preparation is done offshore, Social Security numbers must be redacted.
Preparers will have until Jan. 1, 2009, to implement the new requirements.
The "advanced notice of proposed rulemaking" on refund anticipation loans provides a 90 days for public comment.
The IRS has no authority to ban products such as refund anticipation checks and audit insurance, but has warned consumers to avoid preparers offering high-interest loans, often to low-income people, in anticipation of refunds.
The House last year passed legislation to restrict the RAL industry, but the Senate did not act on the bill.
Matthew Beck, spokesman for the House's tax-writing Ways and Means Committee, said it was "encouraging that the IRS is looking into these predatory loans, but more needs to be done to protect taxpayers." He said the committee and its chairman, Rep. Charles Rangel, D-N.Y., "will continue to pursue the issue closely until it is resolved."