Bonamici Announces Legislation to Protect Consumers From Unscrupulous Tax Preparers

Beaverton, OR – Congresswoman Suzanne Bonamici visited a tax preparation center today and announced her new legislation that includes stronger consumer protections for taxpayers.

Bonamici spoke with volunteers and supporting partners offering free tax filing assistance at the CASH Oregon Super Site in Beaverton.

“Our tax filing process is complicated and often consumers seeking assistance don’t know what fees and add-ons they will be charged." Bonamici said. "This bill will hold tax preparers accountable and ensure that consumers aren’t misled when they seek assistance with filing.”

Bonamici’s legislation would require the Consumer Financial Protection Bureau (CFPB) to oversee for-profit tax preparers. Unlike Oregon, most states place no requirements on the qualifications of tax preparers, leaving taxpayers exposed to hidden fees, mistakes, and even fraud. The bill also targets Refund Anticipation Checks, which filers sometimes use to defer paying their tax preparation fee, and which in 2013 added an estimated $700 million in fees paid by filers to their tax preparers. Bonamici’s legislation will regulate preparers to ensure they don’t siphon off hidden fees from taxpayers’ refunds.

“In many cases, low-income consumers are the target of irresponsible tax preparers, who skim off their refund without the consumer’s knowledge,” Bonamici said. “My legislation gives taxpayers the option to defer paying the tax preparer until the refund is issued.”

The legislation also requires the CFPB to regulate tax preparers to ensure they are qualified. A recent IRS report found that in 2011, 42 million tax returns were prepared by unregulated preparers.

“Despite the support of non-profit organizations like CASH Oregon, there are a significant number of for-profit tax preparers who take advantage of consumers,” Bonamici said. “My bill ensures that taxpayers know they are being assisted by a trained expert and that their money is safe.”

The bill also stipulates new disclosures tax preparers must make; including the cost of preparing and filing a refund and the amount of time in which a taxpayer can expect to receive a refund. It also requires tax preparers to disclose that a RAC is not necessary to receive a refund.

“Consumers should be able to file their taxes without the threat of fraud or abuse,” Bonamici said. “This bill ensures taxpayers are not only better protected, but that they know what their options are when they sit down with a qualified tax preparer.”

###