There may be errors in spelling, grammar, and accuracy in this machine-generated transcript.

Roger Harris: Well. Hello everyone. Welcome to another federal tax update podcast. This is Roger Harris and Annie Schwab and um Annie welcome and tax season it started.

Annie Schwab: Tax season has started. So far so good I have to say no working late nights or weekends for me so far. Uh, knock on wood. But, um, fingers crossed for successful easy [00:00:30] tax season. How's that?

Roger Harris: Yeah, well, it's it's early, but at least so far, so good. We'll see what our feeling is when we get to April 16th. Um, we're excited about, uh, today's podcast. We have someone joining us that I think a lot of you probably will know or have come in contact with, uh, because she's been very visible in, in our community. And we had an interesting. And we'll expand on this as we go through the the next hour. Annie [00:01:00] and I both came in contact with her actually the same day in different settings, and we just looked at each other and said, why don't we get her as a guest on our podcast? So, um, we are excited to have again, someone I'm sure a lot of you know, Jennifer McMillan, who is the current and sitting president of NEA and someone who will welcome want to welcome you and have you happy to have you with us and can't wait to talk to you for the next hour. So, Jennifer, welcome.

Jennifer MacMillan: Thank you. It's great to be [00:01:30] here.

Roger Harris: We should have done this sooner. We should have had you sooner, but oh well.

Jennifer MacMillan: Thank you.

Annie Schwab: It's a pleasure to have you here, and I enjoyed my time with you on our Accounting Today webinar towards the end of the year. Um, but if you would please introduce yourself a little bit to our audience, kind of fill them in on what you've been doing, what your background is, and what your next steps.

Jennifer MacMillan: Yeah. Um, not sure about next steps. I'm I'm right working right in the present right now. I've been an enrolled agent [00:02:00] for over 30 years. And as Roger mentioned, I'm the current president of Neea been, uh, had a practice in Santa Barbara, California for many years and then sold that and ended up semi-retired in Colorado and loving living in the mountains and not having a tax season. Um, thrilled about that. But I am keeping up on what's going on because, um, one of my passions is advocacy. And that's one reason I'm so involved at Neea. [00:02:30] Um, I first joined Neea shortly after becoming an enrolled agent and right away got involved in leadership activities both at NEA and the California Society. So, uh, past president of California Society and was government relations chair at NEA for, uh, for three years and um, eventually became um, uh, got on air sack and became the chair of air SAC. So got [00:03:00] to got to know a lot of DC tax attorneys and a lot of, uh, leadership at the IRS. So I've been very active with that. So that is my favorite part of NEA. And I think it's one of our greatest benefits is the advocacy for enrolled agents and for just great tax administration. We're always pushing for better from IRS.

Roger Harris: Sure. What, you know, looking back 30 years, what what what caused you to [00:03:30] get in this profession?

Jennifer MacMillan: Um, I had taken tax courses in college and then found myself suddenly single and a single mom and ended up back in Santa Barbara, where I was from, and just happened to get a job with an enrolled agent firm. And after I'd been working there for about a year, my boss walked in and dropped books on my desk and said, you're going to sit for the enrolled agents exam this year. And I said, isn't there like some lower license I could get? [00:04:00] And she said, nope, you're going to be an enrolled agent. So I just lucked into it. And as soon as I got my license, everyone in the firm started dropping notices on my desk saying, would you call the IRS about this person? So I got I got trained on the job doing representation and then eventually found out about it. The National Tax Practice Institute, Ntpe, which is Neha's premier education on representation and loved that, learned everything [00:04:30] I needed to know to be a much better representative and eventually ended up teaching for Ntpe because I really loved doing audits and I sometimes loved doing collection representation, offers and compromise were always extremely gratifying in the end. So, you know, I just I've just been really fortunate in my career. And you know, I know you guys are really great advocates for setting yourself [00:05:00] up to become able to sell your practice. And so I did a lot of those things right. Made sure my fees were comparable to other people so that they'd want to buy my practice, but made sure I was keeping track of everything I needed to to do and know in order to to get a really good price for my practice and be able to step away and leave my clients in really good hands.

Roger Harris: So what made you decide this was the time to sell?

Jennifer MacMillan: Uh, well, [00:05:30] uh, it was my I it was just a personal decision. My my husband needed to retire because he had been doing carpentry work, and, uh, he was I was done with him doing that, and he was done with it. Um, and so I just started kind of floating, floating my practice out there and was checking around for enrolled agents in my local area to sell to and other afsp participants, and really didn't find anyone. But I had a friend that was a CPA [00:06:00] who I knew because of my involvement with Csea, and she was local and she operated much the same way I did. And so once I started floating my practice around among CPA firms, I got a call from her saying, oh, Jennifer, so I hear you practice might be for sale. I'm like, yes, we went to lunch and it was a done deal.

Annie Schwab: Wow, that was easy.

Jennifer MacMillan: Yeah, it was super easy. There was a lot of work that went into that floating the practice. But yeah, I was yeah, [00:06:30] I have just been really fortunate. But I've also been really thoughtful about how I put things together in my practice from the very beginning, like making decisions on, you know, how fast my internet speed needed to be back in the year 2002, you know? And so, um, yeah, just put a lot of thought into what programs to buy, to track my time, to track my profitability and all that. So.

Roger Harris: Well, you had to put together a really good firm for it [00:07:00] to be that easy for someone. That's a compliment to you, but doesn't surprise me given the way your whole career led up to that. But yeah, sometimes it's just the right time.

Jennifer MacMillan: Yeah. And and I also, I made sure that my practice was because I did a lot of representation as part of it. I made sure I kept my tax practice fairly small. So I did have work throughout the year, and I had some some holes in my schedule during tax season, which I know seems like a completely [00:07:30] foreign concept to most people listening. But, you know, really, you can structure your practice so that you have excess time in taxes, and it means you get to go home at like 7 p.m. instead of midnight a lot of nights. And also then it leaves room for if a client calls on April 13th and says, oh my gosh, my account, my bank account has been levied. You know, so you've got a little bit of flexibility there. And, [00:08:00] you know, it it really did make for a well-rounded practice.

Annie Schwab: That's exciting. So tell us a little bit more about Neha. I know we've been thrown around a lot of acronyms here, so. Yes. Uh.

Jennifer MacMillan: Neha is the National Association of Enrolled Agents, and it really is a great community. It's, um, we have a web board, and we have a members only Facebook page that really are a godsend during tax season. And other times, you [00:08:30] know, because you can go in and just search for keywords, um, and get really great professional help from your colleagues. Um, I've found that that the members in there tend to be really, really helpful to one another. They'll cite cite the code or regulations? Um, revenue procedures and stuff for others when they ask a question. And it's really been helpful. And also just to know that that you're not alone out there, everyone else [00:09:00] is struggling with the same stuff you are. Like this tax season, I know there's there's just going to be tons of IRS issues for mostly, um, post filing. Um, once those notices start coming, it's going to be a nightmare. And I'm glad that you guys are are hearing good things about tax season going smoothly so far, so far.

Annie Schwab: Um, so far, yeah.

Jennifer MacMillan: Nea currently has a survey out, and I was able to access [00:09:30] the, um, the early responses, the first like 106 people that responded just saying, what are what are your issues? What are you seeing as far as practitioner priority service? Um, you know, the, um, issues with the IRS, and the results are not good. Um, yeah, we're hearing about them putting, um, early trainees on the front lines and.

Annie Schwab: On the phones.

Jennifer MacMillan: Yes, on the phones.

Annie Schwab: Oh, no.

Jennifer MacMillan: And [00:10:00] yeah. And, you know, because the the IRS let so many people go besides dosage cuts, they gave all those people retirement, early retirement, or the ones that were still working after the age of 65. They all decided, yeah, it's time to get out of here. Yeah, they're offering me money. I'll go. So they've lost just a ton of their experienced staff, and they've they have hired a lot. I heard that they're going to start training [00:10:30] people to be on the phones later in February.

Annie Schwab: Oh, wow. Okay.

Jennifer MacMillan: Yeah. So taxpayers are going to be really affected by this too. The 1040 line, um, phone line is going to be clogged for anyone that needs a real person to help. I mean, their online stuff at the IRS is getting better. Um, the tax pro accounts are getting better, but they certainly don't handle the more sticky problems that that we all encounter [00:11:00] on a daily basis in our practices. So, um, so and the the number of disconnects, the, the difficulty of getting through has, has kind of always been a problem.

Annie Schwab: Right?

Jennifer MacMillan: But people are now you know, I had some one person in their comments said I had 25 phone calls to the IRS on a single issue. I never got it resolved, but spent, you know, hours upon hours and so many disconnects either in unintentional or intentional [00:11:30] disconnect, but getting passed around from person to person and nobody being able to help them. So it's been a frustrating time to be a it's.

Annie Schwab: Just the beginning. It's only the beginning of.

Jennifer MacMillan: Yeah. Well, some of these, you know. Yeah. These are people looking for refunds from a 2024 amended return or amended return filed in 2024. They're still working those.

Annie Schwab: They're still waiting.

Jennifer MacMillan: So there are huge backlogs on correspondence, you know, and people getting levied on [00:12:00] things that should have been resolved because they really don't owe the tax.

Annie Schwab: And it's so frustrating for everyone involved.

Jennifer MacMillan: Frustrating. So that's the latest word from from colleagues at Nicaea. So.

Roger Harris: Well, you triggered a story and something I heard yesterday. It's funny how you triggered this about the phones. Um, a person got a notice that they had increased. It was a trust return by tax by $400, with no explanation as to why or anything. So they [00:12:30] called the IRS to try to figure out, well, why do I owe 400 more dollars? They were the return preparer and the trustee and they were told, I can't talk to you. And so the question was, well, who can you talk to if you can't talk to me as the trustee? And the return preparer, who can you talk to? And their answer was, well, I just can't talk to you.

Annie Schwab: Oh, well, I have heard. Well.

Jennifer MacMillan: One of the answers in our survey was about, [00:13:00] um, power of attorney not being honored like people.

Roger Harris: Well, that's what I'm saying. So you get a power of attorney for yourself. I mean, you mean.

Annie Schwab: Right?

Roger Harris: And so finally, I asked the person on the phone says, well, what should I do? And they said, well, why don't you call, hang up and call back and see if you get somebody else?

Jennifer MacMillan: Oh, seriously?

Annie Schwab: Wow.

Roger Harris: True story.

Jennifer MacMillan: I would have told them to do the same thing, but I'm surprised the IRS would say that.

Roger Harris: So they did.They called back.

Jennifer MacMillan: Yeah.

Roger Harris: Use the call [00:13:30] back feature, which and said they got a call back within the hour and that person could handle it, could talk to them and handle them. So yeah, obviously the first person I think they even indicated they were new.

Jennifer MacMillan: So yeah. So yeah, I've heard of problems with escalating things to a supervisor. Those things aren't getting really escalated or too many things are having to be escalated. Other people who there was one story someone had tried to [00:14:00] go to taxpayer advocate with one of these things, and even the advocate's office said, oh, well, we can't help you with that because XYZ. And it was just a completely ridiculous reason that they couldn't help because there wasn't a hardship. So.

Roger Harris: Well, I guess one thing I've learned this week is if you don't like the answer you get from the IRS, hang up and call back because their guidance now.

Jennifer MacMillan: That's always been one of the answers. But also it's like, who's your boss [00:14:30] is the other the other question, they.

Annie Schwab: Probably don't even know who their bosses don't know. So many times.

Jennifer MacMillan: Their boss may not know the answer either.

Annie Schwab: That's true, but I have. How are the processing of returns going? So, you know, obviously the fastest way to get your refund, you know, is to to e-file the return to, to use direct deposit, um, those kinds of things. Have you heard any nightmare stories or are we, are we looking good?

Jennifer MacMillan: Um, I think I think as far as all the electronic things are working great, [00:15:00] it people got it together. But I think as soon as there's an issue, if it takes a person to resolve it, it's going to be a long.

Annie Schwab: Or something on paper or snail mail or.

Jennifer MacMillan: Yeah. And I don't have I never had any clients that had like earned income credit and stuff like that. And I know those those get stuck in fraud filters. But I'm not, I'm not I haven't heard anything yet about those from members.

Roger Harris: And this is anecdotal at best, but someone in our office told me this morning that they filed their tax [00:15:30] return and got their refund in five days.

Jennifer MacMillan: Yay!

Annie Schwab: Yeah, okay.

Roger Harris: This is early and you know, that may not be, but at least it was a good, promising sign.

Annie Schwab: Good sign? Yeah.

Roger Harris: Yeah.

Jennifer MacMillan: But yeah, that's that is good news. Yeah. I have not heard about processing issues. Uh, as long as it's electronically filed and the refunds getting direct deposited.

Roger Harris: Yeah.

Annie Schwab: Yeah. And, I mean, that's that's great. I mean, five days, I mean, that's that's, you know, I still tell people [00:16:00] two weeks, you know, average two weeks. Um.

Jennifer MacMillan: Yeah. And that, you know, that brings up something else I wanted to, to chat about was, um, client expectations. Yeah. Um, I think this year in particular, just because there's so much misinformation out there and, uh, and the one big beautiful thing, um, a lot of our clients have misunderstandings about how things are going. So not only [00:16:30] do you need to have more communication with them this year, um, such as like seniors. Some of them are not going to bring their SSA 1099 in because they think that it's not taxable.

Annie Schwab: Right. They think it's tax free.

Roger Harris: They heard.

Jennifer MacMillan: Yep. That is what they heard.

Annie Schwab: And social media is not helping. I've seen so many things on social media that are just downright wrong or misleading. And unfortunately, you know, I it's it's getting worse as the season's going on.

Jennifer MacMillan: Yeah [00:17:00] I think a lot of communication set aside extra time for all of your clients because there there are so many misconceptions out there. Um, and just in general, you know, keeping clients expectations at, at the low end, you know, so that you can over perform, um, you know, let them know that their refunds are not going to be coming in five days. In general, they might, but, you know, dispel any of those [00:17:30] hopeful, you know, things from your clients if you're, um, you know, unless you have some one of those rapid refund things going on, but. Right. Um, I think most of us do not, um, you know, and and letting them know, especially if they get a notice about something, make sure that they know this could take a really long time to get fixed and that, you know, our fees are going to be commensurate with all the time it takes us to teach the IRS what [00:18:00] what they should already know. You know, site, site, the Internal Revenue Manual for them and teach them their jobs. So it it is it's just going to be more burdensome on everybody. But, you know, the clients need to know that you're going to have to charge them to, you know, address a notice that maybe in the past you could have just kind of put it into their own. Right. Yeah. So so keeping their expectations on the low side because [00:18:30] just because we don't know what's going to be going on with the IRS and the state agencies. A lot of them are having the same issues where they've got, you know, they're low on staff, they've got some untrained staff depending on your state. And some states are just have always been impossible to deal with. You know.

Roger Harris: I think the other thing is we're going to be the ones that's going to have to explain a lot of misconceptions, because we all got bombarded with campaign ads that said no tax on tips, [00:19:00] no tax on overtime, no tax on Social Security. Nobody followed the, you know, the ins and outs of the big beautiful bill. You know they heard that. And then they get on social media and they hear it again. And then they come to us and we go, well, that's not exactly right. Well, I heard it, you know, on an ad, I saw it on social media. So we're going to have to be the one that kind of temper some expectations they had coming in that to your point, particularly Social Security, that, oh, I don't have to report [00:19:30] it anymore. Well, yeah. You do.

Jennifer MacMillan: Yeah. And they're all going to think that they're over time that, you know, not just that extra half and and you know, like coming from California originally, you know, state of California has completely different rules about overtime. And if, if, if the employer is following the state rules, not the federal rules, and having to pay double time because of, you know, excess hours, you know, a lot of that is [00:20:00] still going to be taxable.

Roger Harris: So yeah, and that's your point about charging. Those are the kinds of things that that, you know that California's got different rules. You know all this all this sort of stuff is valuable information that we have to be compensated for. It's not really relevant to how long it takes me to do a return anymore.

Jennifer MacMillan: It's right. Yeah. Because your knowledge that you spent years getting and and a lot of hours doing continuing Education. Uh, all [00:20:30] of that has has value. And yeah, I figured out a long time ago that it's that most things shouldn't be billed hourly. Um, you know, um, other than a lot of representation, work gets billed hourly, but, you know, that's. Yeah, that's you never know what that's going to take.

Annie Schwab: There's going to be things that because there's a lot of stuff that's just 20, 25, for example, the tips and overtime. And then all of a sudden you roll in a 2026 and now you're educating the clients again on [00:21:00] why is this different than the year before.

Jennifer MacMillan: What went away. Yeah.

Annie Schwab: What went away. What's what's this what's this form I didn't have this form before. Um, or you know, last year you asked me these questions, and now you're telling me to do something different. So it's. I don't think this is just a single year. Um, in fact, there's a lot of the provisions run from 25 to 28. So 25 is going to be different than 26. And then two years later you're going to have a lot of things changing. So it's going to be this is going to be a long process. [00:21:30]

Jennifer MacMillan: Yeah.

Roger Harris: And then after we get everybody got it all figured out, it goes away.

Annie Schwab: It goes away. Right.

Jennifer MacMillan: But there will be a new stuff. Don't worry. There's always there'll be something.

Roger Harris: There's always something, you know. And one last thing about working for by the hour, I always, you know, when people tell me I charge by the hour, I said, well, I'm going to give you the best tip I can ever give you to make the most money. Slow down. Because if all you if all you're doing is billing by the hour, then what's the hurry? You know, take as long as [00:22:00] you want to. Obviously that's not a good in addition to, you know, that also negates the fact that you've gotten smarter and can do something quicker. It devalues you having knowledge because it's better off to have to go look it up and right. It just doesn't make sense to charge by the hour. Sometimes it could, but for the most part, charge what it's worth and.

Jennifer MacMillan: Exactly.

Roger Harris: They don't want to pay you. There's plenty of clients out there that will.

Jennifer MacMillan: Yeah. And, you know, there's all those other costs that that variable and, and fixed costs that you've got [00:22:30] to work in there as well. So I used to do all my tax returns were on fee schedule, and I would set this fee schedule at a fairly high level and just say it was a minimum. But then I could the clients that were really organized, I could give them a courtesy discount. And everybody was happy, you know. Right, right.

Annie Schwab: Well, and like you said, it's part of my job, you know, is or most tax preparers is staying in the know. And I know Neha has, you know, their their tax practice institute [00:23:00] that offers education. Um, I mean, all of those are great avenues to to stay in the know. I feel like, you know Rogers in DC a bunch. Jennifer, I know you're in D.C. quite a bit as well. I mean, bringing back all of that knowledge, um, from from these conferences or being part of a community or a group. I mean, all of that adds value to what you can provide.

Jennifer MacMillan: Exactly. Speaking of value, let's put in a plug, [00:23:30] um, for, um, NEA. Three years ago, started, uh, we realized that, uh, what our members wanted was continuing education that was either very low cost or free. So we just started doing a massive amount of free education, really good quality for the most part. Um, and we offer 40 hours a year of free continuing education for enrolled agents and afsp participants. So that right there really [00:24:00] makes up for, you know, the cost of membership. And as a matter of fact, I'm doing a two hour course this afternoon that's given by AJ Reynolds. And, um, looking forward to that. And it's just been a really great membership tool, and it's been great for our members to be able to get all their CE from as part of.

Annie Schwab: Is it all online or are there in-person events?

Jennifer MacMillan: Uh, the free is all webinars. Okay. And, um, we do have our [00:24:30] tech summit every July, um, which is really, really fun. Uh, we're going to have two levels of ntpe there. The National Tax Practice Institute this summer we'll have level one and level three. Okay. And um, level two is available online. And we also have uh tax education track during during tax summit. So we do have two and a half days I think of live ce available in. And this year [00:25:00] we're in New Orleans.

Annie Schwab: Oh yay. Yeah.

Roger Harris: Grew up in New Orleans.

Annie Schwab: So yeah.

Roger Harris: I did.

Jennifer MacMillan: Come join us.

Annie Schwab: Born and raised there. It's I mean I yeah, I need to look into it, I think.

Jennifer MacMillan: Yeah, definitely. Come see us.

Annie Schwab: Fabulous. It sounds like there are a lot of benefits to the membership. And I love that you mentioned the Facebook page. It's so nice to see when people have the same kind of questions that you have. Or, you know, you don't feel so alone when you feel the pain of other people. Like just like you.

Jennifer MacMillan: Yeah, literally when I started out on my own [00:25:30] and Neha and colleagues were the reason I felt I could be out on my own because I had been in an office before where you could just go ask somebody if you had a question about something, always.

Roger Harris: Somebody in that office.

Jennifer MacMillan: Knowing I've got colleagues all over the country, I can call somebody, I've got somebody, and suddenly they're K1's got a bunch of Kentucky income on it. I just get on the phone and start talking to colleagues in Kentucky about what does this mean?

Roger Harris: Well, as opposed to just typing it in, in the software and calling it Kentucky [00:26:00] and hoping.

Jennifer MacMillan: For the best.

Roger Harris: Hoping that got it right. Yeah. All right, you guys, you gotta I gotta ask you this. I, you know, I come back from DC and I'm reading everything. I go to Accounting Today, I go to the checkpoint, all I hear is YouTube about this webinar you guys did. Tell everybody you know, because you became instantly famous. Uh, and so tell everybody.

Jennifer MacMillan: Became instant friends, too. Yeah, that's that's true.

Annie Schwab: That's exactly what happened.

Jennifer MacMillan: So, yeah.

Roger Harris: Share [00:26:30] with everybody what it was about kind of things you talked. I mean, some of it we've talked about today, I know there was more than just you, but I'm going to focus because it was just two of you guys.

Jennifer MacMillan: So just because we were the best two on there.

Roger Harris: Well, evidently, that's all I read. When I got back, I thought, well.

Jennifer MacMillan: It was, it was, it was the move. Moving ahead into tax season. Uh Accounting Today panel. Um, and and actually, Annie and I basically answered the questions the same way. I kept saying exactly what Annie just said. Um, [00:27:00] um, you know, it really was at that point, I was cautiously optimistic about how filing season was going to go. And now that I've seen our the survey results, um, not as optimistic, especially with finding out that they are taking people that are not well trained and throwing them on the front lines on the phones. And those are the same people that that answer correspondence. So I expect that we'll be getting some interesting [00:27:30] answers to correspondence that we send in on behalf of clients. But, um, Annie, what what was your takeaway from that?

Annie Schwab: Right. So this was before tax season opened, which, um, you know, it was sort of like the, the prep of like, okay, well, what do you anticipate? Um, so there were some questions that you and I answered, um, regarding, you know, what are you worried about this coming tax season? You know, how do you how are you going to deal like what's going to be the most difficult thing dealing with your clients? Um, what's the new tax [00:28:00] law going to do? We spent some time discussing no tax on tips, no tax on overtime. Also some of the, you know, dealings with the IRS, you know, definitely new banking account and making sure that banking account information is on there because the IRS is not sending out refund checks. Um, you know how to respond to notices very efficiently so that, you know, hopefully it gets answered the first time around. Um, we talked about making sure that both tax pros get those online accounts [00:28:30] set up as well as, you know, encouraging your clients to go and set up the online accounts for them. There's a lot of information. There's been quite a quite a few enhancements from last year to this year regarding some of those online accounts. So it was it was great. It's recorded. It's out there. You can go see it on Accounting Today. Um, earmark has a version of it, um, as well. Roger and I have discussed a lot of the topics, but it was it was fun and and like you said, it was great to meet you and see you. And now [00:29:00] here we are again. So I hope that we can continue this, this partnership. Um, I always learn something new every time we talk, when, when we're, when we're sharing stories. So thank you again for joining us and for being on that as well.

Jennifer MacMillan: Yeah. Um, one, one thing, um, since we were in D.C.. And that was when, uh, Roger and I went up on the hill together not to. Sorry. Didn't mean to change the subject on you.

Roger Harris: No, no.

Jennifer MacMillan: No, no.

Roger Harris: Just one last thing. I compliment both of you because you were invited to do [00:29:30] this by the people at Accounting Today. So it was a compliment, first of all, that you were asked, and then both of you did a great job. So now go anywhere you want to. I just had to.

Jennifer MacMillan: Say that's how I felt about it too. I was honored to be to be asked. Yeah. Um, well, you know, because we've been talking about advocacy and Roger and I were on the hill together, um, talking to, uh, Ways and Means leadership and, uh, the Ways and means the staff for Ways and Means itself. And it reminds me that, [00:30:00] um, we NEA also has a fly in for members, right where that's going to be May 5th and sixth. It's a members only event. So I would encourage you, if you're an enrolled agent, become a member and and sign up for the fling. It is the most fun two days you can have in Washington, D.C.. Uh, we have a day full of panels, uh, that usually include some past IRS commissioners. We get the tax press to come in and talk to us. Um, you know, usually have a keynote [00:30:30] who's somebody very high up in the IRS that can tell us what's going on, and we can tell them what our issues are. And then we spend a day on the Hill talking about NIS legislative priorities. So that's May 5th and sixth. I encourage you, if you're a member, please sign up for that. It is. It is a blast. And our main, our main issue is going to be what we're hoping will come through this year. Um, we've been we've been working for years on minimum standards for [00:31:00] paid preparers. And I know everybody who watches this is one of those conscientious and competent preparers, of course. And the whole idea is to get the incompetent ones or are the unscrupulous ones out of the industry. And so there is a new minimum standards bill coming up. Um, the House bill has been introduced, um, by Panetta. And, um, I can't remember the representative.

Roger Harris: Do we have one Democrat and one Republican, which makes it [00:31:30] unusual in Washington.

Jennifer MacMillan: Thanks for the reminder. But also, the Senate is coming up with a bill. They did a discussion draft that they passed around among senators for almost a year, talking about what they want to have in an IRS restructuring bill or an IRS reform bill. And they've got a bill, a massive bill that's going to come out with 86 or 87 provisions for the IRS to improve, and one of them is allowing the IRS [00:32:00] to regulate preparers. Um, and it's the minimum standards are just a few hours of continuing education. There's no test involved like there was for the TRP designation and ethical ethical training. So it's the same thing that Afsp participants and enrolled agents are already doing. It will just get the bad actors out of the industry, which is good for all of us. So I'm really excited that that [00:32:30] looks like we've got two bills coming.

Annie Schwab: Yeah.

Jennifer MacMillan: So I mean.

Annie Schwab: This is unusual that everybody's kind of on the same page, I feel.

Jennifer MacMillan: Isn't that though?

Annie Schwab: Yeah, it'd be an interesting.

Jennifer MacMillan: It's one of those places where they can find some bipartisan agreement. So they are all anxious in an election year to get something done.

Roger Harris: Something done, bipartisan basis.

Jennifer MacMillan: And, you know, finally, it sounds like they've all been talking about it. And they realize that this is just consumer protection. So I'm really [00:33:00] hoping this is going to elevate our entire industry. All of us that are competent, uh, are are going to get elevated by this. So I'm delighted and I'm really excited that that's what we're going to be talking about when we go on the Hill on May 5th. And they're talking about potentially, um, um, introducing the Senate bill on April 15th or right around April 15th.

Annie Schwab: Gotcha.

Jennifer MacMillan: So we'll everybody else will be busy. But so, you know, I think that's coming and we're going to be talking about it big time in [00:33:30] May.

Roger Harris: And it's common sense. I mean, it's kind of hard to argue. I mean, and maybe not everybody knows this, but right now, roughly half of the people who prepare returns have no designation of any type. So, you know, they there's no real ramifications other than the marketplace, you know, if they're not competent. And and yet I would bet that most of the people who go to these people probably think they did have to pass some sort of test or take some sort of they.

Annie Schwab: They hold themselves out as educated and qualified and all of [00:34:00] these things and to.

Roger Harris: And some are, some are, but.

Annie Schwab: Not.

Jennifer MacMillan: Many of them are. Yeah. But and those are the people who are already getting some education there. They're paying attention and they're there, you know, taking courses and doing the work to to prepare good returns. But then there are those those that are are not and they have no interest in really understanding what they're doing. They're just getting refunds for their friends and neighbors.

Annie Schwab: Yeah. I mean, we've I've seen it for years. You get new clients that come [00:34:30] from prepares and you're looking at the prior year tax return and you're thinking to yourself, wow, there's a lot of red flags in here and I can't where did this number come from? This this is outrageous. The things that I've seen. Um, you know, it's.

Jennifer MacMillan: Yep. Me. I think we all have. I think we all have.

Roger Harris: And one of the things that hopefully they'll, they'll recognize in Congress is when you have a weakened IRS, I'll call it, you know, with less resources, obviously they have less people, [00:35:00] you know, they can do less enforcement. It's more important than ever that the people who are assisting and preparing everybody's tax return does it the right way, because the monetary cost to the federal government of people just doing whatever makes the client happy or whatever they think they know or don't know with real no ramifications of it coming back to bite you. You know, you don't get audited, you don't get caught. You know, there's no telling, you know, just look at some of the [00:35:30] Covid stuff. And again, we always talk about IRC and but the amount of money that got taken away from the government people weren't entitled to was massive. And again, I all the yes, it was a, you know, a bad time. We you know, I understand Congress moving quickly and everybody moving quickly. I mean hell, we didn't know if we were going to survive much less, you know, worry about tax credits. But the damage to the federal government revenue stream [00:36:00] of having half the people out there doing it just the way they think it's supposed to be done, not the way it's supposed to be done. And hopefully the people in Congress will recognize that this is not just something that we're asking for, for self-serving interests, which we're not, but it's good for government.

Jennifer MacMillan: Yeah. Yeah. The tax gap just keeps getting bigger. And, you know, word has gotten out in the public that they aren't doing very many audits anymore. And, you know, audits are one of the things that keep people honest. So, [00:36:30] you know, uh, preparers and taxpayers alike are, are susceptible to like, oh, let's just put this on the return or let's.

Roger Harris: Yeah, let's just.

Jennifer MacMillan: I think you had you think you had more in contributions. Let's just add a couple thousand, you know, or.

Roger Harris: Yeah. Yeah. And I can remember I'm, I'm probably older than the two of you combined, but, um, there used to be, uh, a fear from taxpayers, particularly in the small business community, that if they didn't [00:37:00] do it right, they would get caught. And they always knew somebody that got an audit. You know, they could. It was real to them. Maybe not them personally, but they knew somebody. I don't even think if you went to someone and said, have you ever been audited, they'd say, no. And if you said, you know anybody that's been audited, they'd probably say no. So that that belief that you have to do it the right way just doesn't. It's just not there like it used to be.

Annie Schwab: The fear.

Jennifer MacMillan: I totally agree. I they used to take every, every town that had an IRS office used to audit one [00:37:30] blue collar worker and one doctor and just really nail them, and then put that on the front page of that newspaper on, you know, April 10th or so, doctor. So and so, you know, loses IRS audit and forced to pay millions of dollars.

Roger Harris: And they used to do that to some practitioners. I can remember where, you know, they would come in and do a, you know what they called it. Prepare a project or prepare.

Jennifer MacMillan: Yeah.

Roger Harris: And they would make that public. So you've lost that. In [00:38:00] addition, you know, for the people that aren't doing things the right way. I mean, again, I just I don't know why anybody and I don't think there's many people that oppose it on its merits. There may be some people who fight. I think personally, I think you and I would agree we wish it was stronger, you know, in terms of, you know, a tougher standard to meet.

Jennifer MacMillan: But we would have liked a test, but we but in order to get everybody on board, that was the thing we were willing to give up to get Natpe and AICPA [00:38:30] everybody on board with. Yeah, this is just common sense and let's not make it a hurdle for people. Don't make it a barrier to entry. Um, just make sure that who's out there working on tax returns for money is actually competent.

Annie Schwab: So yeah, baby steps. But it will make a difference. It'll make a difference when you start going down that trajectory. Yeah.

Jennifer MacMillan: It'll I really do it will help tax administration. And that really is what we're all about is is good tax administration. We'd love it if the [00:39:00] IRS just had more money so that they could handle more of the tax administration stuff. But it's on us now.

Roger Harris: So yeah, more burdens gonna fall on us. And, you know, the budget stuff, it's just I laugh and say, tell me, one politician that got elected by campaigning, I'm going to give the IRS more money.

Jennifer MacMillan: Exactly.

Roger Harris: So, I mean, I get it. It's an easy it's an easy agency to come after. And it's, you know, everybody's got a certain amount of. But, you know, I still [00:39:30] hear that there's some people think there's 84,000 armed IRS agents running around and it's like, you know, no there's not. Yeah, there are a few. And you don't want to meet them, but they're not anywhere near 84,000 of them. And if you meet one.

Jennifer MacMillan: Special agent on the back are not the ones you want to meet.

Roger Harris: Yeah. You've done something really wrong. If you meet an IRS agent that has a gun, I can tell you that.

Annie Schwab: Very true.

Roger Harris: Yeah.

Annie Schwab: Well, what else should we know about this upcoming tax season or more efforts from na. [00:40:00]

Jennifer MacMillan: Oh, you know, one one thing that I did want to talk about because it's just very recent, um, there was this issue in Oregon and I'm not sure how many people, um, that are listening or watching, um, know about this, but it came to our attention that Oregon started enforcing their licensure rules, and most of us didn't even know we needed a license in Oregon in order to prepare an Oregon [00:40:30] Retrievr.

Annie Schwab: Even if you're not living in Oregon.

Jennifer MacMillan: Even if you're not living in Oregon. So they never enforced that part of it until recently. And then suddenly people were getting letters saying, you know, you're not allowed to file in Oregon because you must have this license, um, from the Oregon State Licensure Board, whatever that board is. And, um, they they have had this law, I guess, for a very long time, but didn't enforce it. They still don't have the enforcement [00:41:00] structure, they don't have the money to enforce it. But they started letting people know, hey, you have to have a license to to file even one Oregon.

Roger Harris: No minimum number. I mean, right.

Jennifer MacMillan: So the bigger firms all know about this because they've had to license all of their people in Oregon. Um, smaller firms. You know, I never would have known this just because I never filed returns in Oregon. But if I have somebody who buys a rental property in Oregon, you know, I'm sunk. So, um, CPAs have [00:41:30] always been exempted from from this rule. Um, but enrolled agents were not. And so we any hired a lobbyist out in Oregon and the Oregon Society of Enrolled Agents helped out. And, uh, we got legislation introduced and added to an omnibus bill this year to exempt enrolled agents from the requirements. So it helps enrolled agents all over the country, and it also helps the Oregon enrolled agents because they [00:42:00] were not authorized to be employers of non-licensed people. So now this will also allow their employees to do some preparation or a partial preparation without having to have this license as long as as long as they are supervised by an enrolled agent. So we are almost past we're almost to the the deadline for this bill to go through. I believe it's going to go through. It hasn't been [00:42:30] opposed. Um, AICPA signed off on it as well. Um, the other national organizations are all for it. So I'm really, really hoping that that we've got a win. I don't want to jinx it by saying it's done because it's almost done.

Roger Harris: It's not over till it's over.

Jennifer MacMillan: I want you all to know that, uh, that, uh, NEA has, has saved us all from from a lot of hassle in the state of Oregon. And we're hoping that this means also that other states [00:43:00] will follow.

Annie Schwab: That's what I was going to say.

Jennifer MacMillan: If they bring up legislation, we'll be right on top of it and be able to say, well, well enrolled agents are also exempted in Oregon. So. Right. Um, and we we have, you know, we've had different state issues over the years. Uh, we had an issue in Minnesota.

Roger Harris: Something in Minnesota.

Jennifer MacMillan: I remember that where that was a really big fight. We had a member who was told he couldn't do get a retainer for representation. I believe that was what the main issue was. And it was like, you can't do representation without [00:43:30] getting a retainer, because if they're not afraid of the IRS, they're not afraid of, you know, um, so you're not going to get paid if you do representation without a retainer. So, um, so we we got that also done through legislation. And, and that was just a huge win for us. So even though we're a national organization, we're really watching out for enrolled agents writes in all the states as well.

Roger Harris: Yeah. Because again, there's a different level of awareness of what the enrolled agent is and what they're allowed to do [00:44:00] and not do. And, um, so you need an organization to kind of step up when because I know we've seen it, Annie and Paget, where some business or agency would require statements from a CPA for some purpose without realizing what the cost of that really does to the small business owner. And you know that it's basically for most small businesses just producing their tax return. And yet you had to go pay somebody [00:44:30] else a lot of money to, to comply with a rule that doesn't make any sense.

Jennifer MacMillan: Yes, exactly.

Roger Harris: All right, Jennifer, now that you have sold your practice, you've got, let's see, 3 or 4 months left as president of NEA.

Jennifer MacMillan: Yes.

Roger Harris: What's next?

Jennifer MacMillan: Camping. Camping. Yeah, actually, that's what I'm doing this tax season. It's really fun, uh, to to be able to go out and play. I never thought I'd be able to play between February [00:45:00] and April. And it's it is really fun. And yeah, I would encourage everyone to be looking way off into the future to when you're going to sell your practice and be able to go off and do what you want during tax season. Um, I, I'm too old to ski anymore. But, you know, my dream was always to someday get to go skiing again after December, but no.

Roger Harris: Well, and you mentioned you're doing a webinar this afternoon, so I'm assuming you're still going to stay engaged in.

Jennifer MacMillan: Oh [00:45:30] yeah, for sure. I just and I just I just renewed I just got my new card yesterday for I'm enrolled for another three years.

Roger Harris: So you got three more years.

Jennifer MacMillan: I'm definitely going to stay active. And I'll stay active at NEA as well. Um, but it is. Yeah. The community is kind of part of my life, so I think I'll just kind of stay there.

Roger Harris: Yeah. And now you're in Colorado. You moved from.

Jennifer MacMillan: Yes.

Roger Harris: To Colorado.

Jennifer MacMillan: Went from warmth to snow. But I really it turns out snow is really great if you don't have to go anywhere, you know? Yeah. [00:46:00]

Annie Schwab: Okay.

Roger Harris: Yeah. Well, I'm in Georgia and we got snow and ice two weekends in a row. And I can tell you what, we're not good with that stuff.

Jennifer MacMillan: We were warmer than you that week. Yeah. Florida was colder than us, so. Yeah. No, it's it's absolutely beautiful up here. And, uh, you know, a lot of us Californians are retiring here, and they're not they're not necessarily happy with us, but, um, I'm just I'm. I'm now a coloradan. I'm not a California transplant. I'm a coloradan.

Roger Harris: No [00:46:30] more. No more ties to California. Well, you probably saving on taxes, too, I would imagine.

Jennifer MacMillan: Well, I was, uh. Well, the few clients I took with me when I left were all in California. So I have a source issue. Oh, okay. So I still my schedule C is still out in California, but.

Annie Schwab: Yeah.

Jennifer MacMillan: But now this is my my first year without a schedule C I'm delighted. There you.

Annie Schwab: Go. Well, tell us, tell the audience. Um, those that are listening, if they want to find out more information about Neha or [00:47:00] the benefits or becoming a member or even volunteering, I know there's some volunteer opportunities as well. Uh, we've got just a few minutes, so. Yeah. Make sure.

Jennifer MacMillan: Well, Neha, um, membership is, uh, you can find everything at neoform. And, um, there's there are a whole bunch of, you know, a whole bunch of member benefits besides what I just mentioned. Um, we would be. We would love to have you on board. [00:47:30] And. Yeah, I did want to talk about volunteering a little bit, uh, at the end here. Go ahead. I know Roger and I both have volunteered at NEA for for a long time, and, uh, it is one of the reasons I was able to go out on my own and and find, you know, find so many colleagues that are willing to help if I have like a problem in another state. Um, just having that community has been great and being involved in [00:48:00] leadership has has been just a boon. I mean, I never would have been on or chaired RSK had I not had the experience volunteering at, at NEA and Csia. And it's just been it's been delightful to be part of a team. And in any kind of volunteering, you always get more out than you put in. And I can tell you, I've put in a lot of hours and time and effort, uh, in my volunteer work over the years. But as my husband [00:48:30] says, that I thrive on it. So it really is it. It makes life really worth living and and lots of fun to have so many colleagues that are really dear friends. And I discovered years ago, A few years ago, my husband said, can we take a vacation someday when the enrolled agents don't all come along? I realized that maybe we should be to keep the volunteer stuff a little bit outside of my private life. But, you know, all of my best friends are enrolled agents, so what can I [00:49:00] say?

Annie Schwab: Well, and as a tax practitioner, you know, I really do appreciate all the efforts that that you guys do. And Roger too. It makes a difference for for our profession and I appreciate it. So thank you for that.

Roger Harris: Well, one thing I'll say about Jennifer, I don't know that I've ever seen her when it wasn't something of there wasn't some professional reason. She's always got a smile on her face. So, you know, she's enjoying it. I mean, she's.

Jennifer MacMillan: I am I love this.

Roger Harris: So she is she is into what she's doing. And I've seen you sit at tables at IRS forums [00:49:30] and do all, you know, everything that you could imagine, but you always did it with a smile.

Jennifer MacMillan: So yeah, I do tend to smile a lot. Yeah.

Roger Harris: That's okay. That's a good thing.

Jennifer MacMillan: It makes people smile back at me.

Roger Harris: That's right.

Jennifer MacMillan: And that's when I was a baby. I figured out that if you smile at people, they'll smile back at you. Yeah.

Roger Harris: Yeah. All right, Danny, what else we got for today?

Annie Schwab: That's all I've got for today. Um, we will be coming back with some more information on. No tax on tips, no tax on overtime, and in [00:50:00] our future podcasts. I'm already working on some content there. So, um, hopefully everyone's enjoyed this session and continue to to watch our podcast.

Roger Harris: Yeah. And uh, Jennifer, thank you so much for for joining us today. It was a pleasure to spend some time with you in DC, I guess two weeks ago. I'm trying to remember I gotta go back next week. I'm trying. They're running together. And, uh, thanks for all you've done for the profession.

Jennifer MacMillan: And thank you.

Roger Harris: We are we are fortunate to have you here today, and we need [00:50:30] to have you back. And we can compare our stories.

Jennifer MacMillan: Okay. Excellent.

Roger Harris: Yeah.

Jennifer MacMillan: Thank you so much for having me. This was great.

Roger Harris: Well, it was our pleasure. And you're welcome back anytime. So we'll hopefully see you again soon. Well, no, we'll see you and hopefully we'll see you. I'll see you in May. Yeah, well, I hope so. We're trying okay. Yeah. That's the plan. So.

Jennifer MacMillan: All right, all right.

Roger Harris: And Annie, thank you. Always a pleasure to see you. And, uh, we'll be back in a couple of weeks with another rambling [00:51:00] on of Roger and Annie. Hopefully some of it will make sense. We got in 50 minutes. We'll hope you get something out of it. And thanks everyone for listening. I know it's tax season for most of you and good luck and hopefully you'll have a wonderful tax season and I know you'll be ready for coming out of it. And the weather will be nicer, the sun will shine brighter, and you'll have more money in your bank than when you started it. So good luck to everybody. Thanks for listening. See you again soon. Bye, everybody.