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IRS Lowers PTIN Renewal Fee: What Tax Professionals Need to Know

Tax professionals received a bit of good news this week: the IRS announced it is lowering the Preparer Tax Identification Number (PTIN) renewal fee to $10 (plus an $8.75 contractor fee). This change takes effect October 16, 2025, and applies to all new applications and renewals. While the reduction may seem small, it highlights the IRS’s ongoing recalibration of how it funds tax preparer oversight.


IRS

What Happened

  • On September 30, 2025, the IRS and Treasury issued final regulations reducing the PTIN user fee.

  • The new fee is $10 per application or renewal, down from the prior $19.75 charge.

  • In addition to the IRS fee, a $8.75 contractor fee (paid to the third-party PTIN system administrator) remains in place, making the total $18.75 per preparer.

  • The IRS cited updated cost analysis and efficiency gains as justification for lowering the government’s portion of the fee.


Why It Matters

For CPAs and Tax Preparers

  • Lower overhead costs: The annual expense of maintaining a PTIN is modestly reduced — welcome relief for sole practitioners and smaller firms with multiple preparers.

  • Signal of accountability: The IRS has faced legal challenges in the past over PTIN fees, with courts requiring it to ensure fees reflect actual administrative costs. This move signals responsiveness to that scrutiny.

  • Credential compliance remains essential: Even at a lower price, preparers must maintain a valid PTIN to prepare federal returns for compensation.

For Firms

  • Budgeting: Firms that cover PTIN fees for staff will see incremental savings, especially across larger teams.

  • Recruitment/retention: Lower barriers may encourage new entrants into the tax prep workforce, helping with seasonal staffing.

  • Compliance messaging: Firms should communicate clearly to staff that PTIN renewal is still mandatory despite the lower fee.

For the Industry

  • Preparer regulation debate continues: The fee change underscores the ongoing discussion about IRS oversight of tax professionals, especially as Congress debates whether to expand IRS regulatory authority over preparers.

  • Technology efficiencies: By outsourcing part of the PTIN system to a contractor and streamlining internal costs, the IRS is signaling its intent to modernize administrative functions.


What’s Next

  • Renewals begin this fall: Preparers should renew their PTINs early to avoid last-minute issues, especially with the IRS operating under the strain of the ongoing government shutdown.

  • Watch for system updates: The contractor fee suggests the PTIN online renewal portal may see upgrades or interface changes in the coming year.

  • Policy implications: If Congress or the IRS push for expanded oversight of preparers, PTIN registration may take on even greater significance as the foundation for broader regulation.


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