IRS Argues Your Tax Return is Just Like a Dead Horse
Normally this would be a good Friday story, but you can't always control when Washington is going to bring the crazy.
The Obama administration on Tuesday defended its effort to regulate the tax return preparation business for the first time in U.S. history, basing its case largely on a 19th century law dealing with horses lost or killed in the Civil War....
[the Obama Administration attorney] explained that the administration sees the "Horse Act of 1884" as providing ample authority for the U.S. Internal Revenue Service to regulate the tens of thousands of preparers who fill out millions of Americans' federal tax returns.
Here is the logic, such that it is
A post-war industry emerged of agents who would press war loss claims for a fee, usually a percentage of the claim collected. Soon, claim values were being fraudulently inflated.
In response, the government started regulating these intermediaries, barring unscrupulous ones and certifying honest ones as "enrolled agents," a title that is still used today by people who represent clients in matters before the IRS.
The IRS is arguing that tax return preparers represent their customers in much the same way that enrolled agents do, so the agency should be able to expand regulation to include preparers.
Note that tax preparers are not actually IRS enrolled agents, they just argue they are kind of sort of like them (in that they both deal with tax returns, I suppose). But enrolled agents explicitly act as an intermediary between citizens and the government in disputes and claims. This is not the role of tax preparers. They merely charge a fee to fill out time-consuming and confusion paperwork. My tax accountant has never once had any conversations with the IRS on my behalf, nor should he. I would engage an attorney for that.
