Oregon Tax Board asserts authority over EAs

[Lee B]

A little background: Oregon was the first state to license tax preparers in 1973.

It's a two step process, first you must past a test to become a Licensed Tax Preparer

and then after two years of experience under a Licensed Tax Consultant, you can

take a more comprehensive test (very similar to the EA Exam) to become a

Licensed Tax Consultant. (Note: CPAs and Attorneys are exempt from these rules.)

In Oregon almost all EAs have gone thru this process before becoming EAs.

Over 20 years ago when I became an EA, I also held an active CPA license

so I was given a LTC license and was not subject to the other requirements.

 

Where the conflict arises is when someone with an EA license moves into the state

and wants to start preparing tax returns. Oregon's Tax Board is saying, you can't.

This conflict has been intensifying over the last several years resulting in an

official statement from the Oregon Society of Enrolled Agents as follows:

 

"The Board of Directors of ORSEA feels that: 

 

The Oregon Board of Tax Practitioners has broken the law. Not accidentally, but with full knowledge.

 

In January of 2013, the Board issued Rule 800-020-0015 (5), requiring enrolled agents to have 360 hours of work experience during 2 of the prior 5 years to become a Licensed Tax Consultant.

 

The rule has the effect of prohibiting an Enrolled Agent with less than 360 hours from working under a Licensed Tax Consultant to gain the experience required; effectively shutting the door on using the Enrolled Agent License to begin a career in Oregon.

 

They knew they broke the law when they passed the rule.

 

Oregon Revised Statues explicitly state:

 

"the board shall license as a tax consultant any person who is, on the date of the application for a tax consultants license, enrolled to practice before the Internal Revenue Service pursuant to 31 C.F.R. part 10 if the person has passed to the satisfaction of the board an examination covering Oregon personal income tax law" ORS 673.637.

 

Knowing they broke the law they tried to cover themselves by submitting a bill (HB2214) attempting to change the law after the fact. The legislature rejected the amendment, calling it a "solution without a problem."

 

According to the minutes of the May 2013 OBTP meeting "The Board members would like to retain the 360 hour requirement regardless of the absence of the requirement in the statutes."

 

They broke the law and they knew it! They even wrote it in their minutes!

 

The Tax board wasn't in the least bit interested in following the law since they did not even respond to our attorney's request to explain their legal reasoning (if any) they had for passing the rule. We as an organization have asked the Oregon Court of Appeals to invalidate the rule.

 

The only purpose of the rule is to prevent new EAs and semi-retired EAs from working. There has never been a documented case where an unsupervised EA with less than 360 hours of experience has harmed anyone. The OBTP director admitted this in testimony in front of the legislature. The Rule is illegal. The board knows this"

[kcjenkins]

Glad to hear that a lawsuit has been filed.  That sort of regulatory overreach should be fought whenever found.