Nice Seasonal Tax Practice You Have Here. Be Ashame If Something Happened To It!

That something may be happening in the form of IRS regulations regarding paid preparers. This proposal appears to have the support of outfits such as H&R Block (or H&R Blockheads as the WSJ identifies) and Jackson Hewitt. I've written before about Jackson Hewitt.

Are these firms truly trying to make the world a better place by ensure fair and accurate tax preparation or are they engaged in rent seeking?

This proposal is bound to make it cost prohibitive for some small shops to comply with the rules. If cost isn't a factor, the bureaucratic nightmare will be. That would cause some preparers to close shop, thereby providing a nice competitive advantage to the H&R Crocks of the world.

I've never been much for protectionists and now that it has come to my industry, I feel no differently. If the Treasury Department believes there is a revenue gap created by fraudulent returns it should use its existing resources and systems to address that problem rather than creating more bureaucratic red tape which may be difficult to enforce anyway.

And even better, how about simplifying the code, removing targeted tax breaks and reduce tax rates? Sound good? Don't hold your breath!