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IRS loses appeal on new rules for tax preparers

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By AP

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Updated: Tue, 11 Feb 2014 01:15:05 EST

WASHINGTON (AP) — The IRS has lost a federal appeal in a legal battle over its effort to institute competency exams and other new regulations for many paid tax preparers.

The unanimous ruling Tuesday from the federal appeals court in Washington upholds a lower-court ruling last year that the IRS lacked the authority to impose the new rules without congressional authorization.

The regulations were challenged by the Institute for Justice in Arlington, Va. It is a libertarian legal group that argued that the proposed regulations were onerous and would have put thousands of mom-and-pop tax preparers out of business.

The IRS has said the rules are needed to weed out ill-trained and incompetent tax preparers.

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