What is an AFSP Tax Preparer?

During tax season, a huge number of Americans turn to the assistance of professionals to make sure that their returns are completed properly and in a timely manner. Since there so many options, you need to know who you are dealing with. The AFSP Tax Preparer is one of the credentials that you may encounter.

But what does AFSP mean? Why does it matter? And what does it mean to you as a taxpayer?

We will explain in an understandable manner.

What Does AFSP Stand For?

AFSP is the abbreviation of Annual Filing Season Program. The program is an initiative established by the Internal Revenue Service (IRS) as a way of rewarding tax preparers who exceed what is required of them.

Tax preparers enrolled in the AFSP are called AFSP Tax Preparers. They also engage in continuing education and keep abreast of what is happening in the laws of taxation to serve their clients in a better manner.

What is Annual Filing Season Program?

In 2014, the IRS introduced the AFSP to motivate non-credentialed tax return preparers to engage in continuing education (CE).

Although not compulsory, this program helps to:

• Develop preparer tax law awareness
• Give superior service to taxpayers
• Cut down on mistakes and tax filing fraud

Tax preparers obtain the Annual Filing Season Program Record of Completion by satisfying the AFSP requirements annually, especially because the IRS recognizes this program.

What is the AFSP’s Focus?

The AFSP is aimed at non-credentialed tax return preparers, that is, those who are not:

• Certified Public Accountants
• Enrolled Agents
• Attorneys

Many tax preparers in the U.S. do not have educational qualifications. Still, they are able to exhibit professionalism and current knowledge on tax by undertaking the AFSP.

To qualify, they must:

• Complete continuing education–18 hours approved by the IRS annually,

  Including:

• 6 hours of Annual Federal Tax Refresher course
• 10 hours federal tax law subjects
• 2 hours of ethics
• Resetting their PTIN every year
• Meeting IRS requirements, including Circular 230 requirements

AFSP vs. Other Tax Credentials

The following is a brief comparison of the AFSP Tax Preparers against other categories of tax professionals:

Key Difference: Enrolled agents, CPAs and attorneys are the only people who may represent clients in front of the IRS in all cases. The rights of AFSP Tax Preparers to representation are limited, and we will discuss this next.

Benefits of Working with an AFSP Tax Preparer

When you do not collaborate with a CPA or an enrolled agent, using an AFSP Tax Preparer can be beneficial in several ways:

Up-to-Date Knowledge

The AFSP preparers undergo training on the current changes in tax law on a yearly basis, thus they have a higher chance of detecting deductions or credits that other preparers may not.

Verified by the IRS

IRS AFSP Tax Preparers are listed in the public database of return preparers, so you are assured that they have passed many standards.

Limited Representation Rights

AFSP preparers are permitted to represent you with respect to returns they prepared and signed,

Only to the Extent of:

• Client audits
• Customer service issues
• Tax account matters

They are not able to act on your behalf and make appeals or collections as CPAs or EAs.

Ethical Standards

They should also undergo ethics training and adhere to the IRS Circular 230 that stipulates ethical conduct and competence.

How to Verify an AFSP Tax Preparer

It is prudent to look at the qualifications of a tax preparer before employing him or her.

The IRS offers an online directory of Federal Tax Return Preparers with Credentials and Select Qualifications as the IRS Directory of Federal Tax Return Preparers.

You Can Find It Here:

https://irs.treasury.gov/rpo/rpo.jsf

This Directory Allows You to:

• Search by ZIP code
• Verify credentials
• Check whether a preparer has done the AFSP

When a preparer is not listed, it could be an indication that they are not credentialed or that they did not satisfy the AFSP criteria.

Is an AFSP Tax Preparer Right for You?

The following are some of the questions to ask yourself:

Do you have a simple tax return?

An AFSP Tax Preparer can be appropriate with just W-2s, few deductions, and no complicated business income or investment.

Do you need help understanding tax law changes?

Since the AFSP preparers attend yearly refresher courses, they are better placed to deal with the current developments, such as the changes in tax credits or IRS regulations.

Do you need full IRS representation?

You may require a CPA, EA, or attorney who has full representation authority in case of a tax audit or back tax debt.