HB5527 - State Tax Preparer Oversight Act

• Income tax return preparers must include their Preparer Tax Identification Number (PTIN) on all Illinois income tax returns and refund claims filed for taxable years beginning January 1, 2017 or later.

• Department of Revenue shall develop an oversight program using PTINs to assess returns, identify high error rates, detect fraud patterns, and evaluate unsubstantiated tax positions by preparers.

• Department shall establish communication protocols with the Internal Revenue Service and other states to share information on preparers suspected of fraud, disciplined, or barred from filing returns.

• Preparers who fail to provide their PTIN face civil penalties of $50 per offense, capped at $25,000 per calendar year, unless the failure is due to reasonable cause and not willful neglect.

• Department may investigate preparers and bar or suspend them from filing returns for good cause, with disciplinary actions subject to a hearing process and judicial review.