HI SB1504

Tax return preparers must obtain and maintain a valid preparer tax identification number issued by the Internal Revenue Service under Internal Revenue Code section 6109.

Tax return preparers are prohibited from preparing returns or claims for refund for compensation without a valid preparer tax identification number, and must include their identification number on returns and claims as required by the Department of Taxation.

Penalties for violations are $100 per violation for the first 100 violations, $500 per violation for violations 101-500, and $1,000 per violation for all subsequent violations, with each return or claim prepared in violation counted as a separate violation.

The Director of Taxation may waive penalties in part or full for reasonable cause, and preparers may pay at least 15% of a penalty within 30 days to stay collection action while pursuing a refund claim or appeal.

The Department of Taxation may seek civil injunctions in circuit court to prevent violating preparers from continuing to prepare returns or, in cases of continual or repeated violations, from acting as a tax return preparer altogether; provisions apply to tax returns filed after December 31, 2019.