DLLR's Division of Occupational and Professional Licensing

 

FAQ - Maryland Board of Individual Tax Preparers

 

1. Where is a complete listing of those individuals exempt from Maryland Registration? I have only really heard about exemptions through word of mouth, but I want to make sure I understand the whole picture.
On our webpage, click on the REGISTRATION Tab and you will find the exemptions listed. The list is taken directly from the Maryland statute, Business Occupations and Professions Article, Title 21-102(b).

2. I am a CPA, exempt from Maryland registration; however, I have several employees working for me who prepare Maryland tax returns. Do my employees fall under exemption number 5?
"an individual serving as an employee of or assistant to an individual tax preparer or an individual exempted under this subsection in the performance of official duties for the individual tax preparer or [the exempt individual.]"

It depends to what extent the client recognizes the employee as his or her tax preparer. If the employee sits before the client and prepares substantially all of the return and the client identifies the employee as his or her tax preparer, then the employee must be registered. If the employee, rather, only acts as a receptionist or only gathers information in order to assign another tax preparer to a client, then that employee would fall under the exemption and need not register.

3. Does registration apply only to tax professionals physically processing a Maryland state tax return in Maryland, or does it pertain to the personal residence of the employer? For example, if I am a tax professional who resides in Maryland, but I work and process tax returns in the state of Delaware, do I have to register with the state of Maryland?
Maryland Registration is not dependent on the preparer’s personal residence, but whether the preparer’s business includes preparing Maryland returns - either in state or out of state. If an out of state preparer is preparing Maryland returns as a significant part of his/her business, then he or she must register. However, those out of state tax professionals who prepare an occasional Maryland return for a walk-in client may not be required to register with Maryland.

The legal opinion from the Board’s Counsel states:

"[T]he requirement for registration would depend on what professional contacts the individual has with Maryland that concern providing, attempting to provide, or offering to provide tax preparation services in Maryland. If preparing Maryland returns is a significant part of the individual’s business, and the individual has significant contacts with Maryland, then the Board would expect the individual to register with Maryland."

4. Maryland requires an applicant to pass an examination in order to qualify for registration. Is this in addition to the examination required by the IRS?
The following explanation appears at the bottom of the REGISTRATION Tab on the Board’s webpage:

Examination
Maryland law requires that applicants for registration pass an examination, Section 21-302(e) of Title 16, Business Occupations and Professions, Annotated Code of Maryland. At its regular meeting held May 20, 2013, the Board resolved that Maryland registered tax preparers may practice until December 31, 2014 without having passed an exam, or, should the Internal Revenue Service again require the RTRP exam, until the deadline for taking the RTRP exam, whichever is earlier.

Those tax preparers who have taken the RTRP exam and passed have satisfied the Maryland examination requirement. Please keep the certificate issued by the IRS.

5. How and when does the tax professional receive his or her registration number upon submitting the registration fee?
The applicant must verify his or her PTIN number by submitting one of two supporting documents:

  1. The PTIN Application Confirmation screen from the electronic transaction that is used to apply for a federal PTIN. (Applicants should print this screen when it appears, because one can’t go back into the application to get it later.)

  2. OR

  3. The Welcome Letter received from the IRS subsequent to a PTIN Application Confirmation.
    Once the Board receives (by mail, fax, or email attachment) the PTIN documentation, the Board’s administration releases the application, and the tax preparer receives his or her registration number and card in the mail, usually within 5-10 business days.

6. What are the Maryland requirements for Continuing Professional Education (CPE)?
The Board of Individual Tax Preparers requires registered tax preparers to complete, upon renewal (every two years), at least 16 hours of continuing education. Therefore, the two-year time period would run from the date of registration or renewal. Four of the 16 hours must be in Maryland state tax-related subjects. Two(2) of the four MD hours may be satisfied by a federal or state course in ethics.

Click on the CPE Tab on our web page for on-line access to the CPE Audit Checklist.