California’s new practice privilege regulations have created a furor throughout the profession. The Jan. 1, 2006 requirement to register for a practice privilege in California for non-resident CPAs that prepare even one California business tax return, coupled with the requirement for the CPA firm to be registered to practice, has the entire profession complaining to the California Board of Accountancy (CBA). All eyes are riveted on the CBA’s Feb 23, 2006 meeting to address these complaints.
See TSCPA’s analysis of and response to the California rule here.
What many CPAs have missed is that this is not a problem unique to California. There are a number of other states that require a CPA to be registered with a practice privilege or temporary permit if they prepare state tax returns. Finding out what individual states require can be a burden – however, there are several places to find summaries of the various state requirements …
- In response to this issue, California CPA Art Berkowitz has prepared a spreadsheet outlining various state requirements.
- The state of Idaho has a summary of state registration requirements here.
- AICPA also has state regulatory information here (PDF).
All of these sites have further links to the various state boards of accountancy.
If you are a Texas CPA preparing other state’s tax returns for your clients, you should check out the varying licensing rules in those states to be sure you are in compliance with practice privilege, registration or licensing requirements.