If your company uses an outside professional to prepare its taxes, you’ll want to make sure that he or she is up to speed with the IRS’ rules regarding PTINs, or Preparer Tax Identification Numbers. Earlier this month, the IRS said it was sending letters to 100,000 tax preparers who failed to follow new regulations that now are in effect.

Last year, the IRS launched a new program “to increase its oversight of the tax return preparation industry.” The goal was to ensure that the individuals who prepare tax returns are “competent and qualified,” the IRS said in a notice. Until now, tax return preparers were not required to meet any competency requirements.

This has become more of a concern, given the increase in the proportion of taxpayers that hire tax professionals to help them with their returns. For 2007 and 2008, more than 80 percent of federal tax returns were filed using either a tax return preparer or tax software, according to a 2009 IRS study, Return Preparer Review.

Among other changes initiated by the IRS, tax preparers now need to obtain a PTIN and include it on the returns and refund claims they prepare. This includes CPAs, attorneys and enrolled agents, according to this article in the Journal of Accountancy. In addition, preparers who are not CPAs, attorneys or enrolled agents will need to pass a competency exam and suitability check, and take continuing education classes; the IRS plans to initiate these requirements this fall. Overall, more than 712,000 tax preparers have registered and obtained PTINs, the IRS says.

Even so, some tax preparers are using outdated PTINs or Social Security numbers on their returns, the IRS says. A few neglect to sign the returns they prepare. The IRS said it is planning, later this year, to contact taxpayers who appeared to have had help preparing their returns, but whose returns lack a PTIN and preparer signature. “Taxpayers should never use tax return preparers who refuse to sign returns and enter PTINs,” the IRS said in the release.

A PTIN is required for any individual who is paid to prepare tax returns, according to this FAQ on the IRS website. What’s more, PTINs can’t be shared, even among tax preparers who work in the same office. However, an employee who prepares his or her employer’s tax return is not required to obtain a PTIN, nor to sign the return as a paid tax preparer.

While the PTIN program appears to have been generally well-received – after all, few indviduals or companies would want to pay someone to prepare their taxes and then find out the person failed to follow all the rules, attracting the attention of the IRS – has generated some concern. In February, Tax Executives International, a professional organization for in-house tax professionals, sent a letter to the IRS expressing its concern that the PTIN rules were overly broad, and “if left unchanged, will unintentionally subject a substantial number of individuals who are properly not the focus of the Preparer Review to the PTIN rules.” This could include in-house tax professionals, and particularly those who prepare tax returns of entities with which their employer has an ownership stake or fiduciary relationship, the letter said.