Could a tax preparer legally have a PTIN but be denied an EFIN? What would prevent approval?

This is definitely concerning. While having a PTIN (Preparer Tax Identification Number) and an EFIN (Electronic Filing Identification Number) are both requirements for tax preparers, they have different approval processes and standards. The PTIN is fairly straightforward to obtain - almost anyone can get one by applying and paying the fee. It's basically just registering yourself as a tax preparer. The EFIN, however, has a much more rigorous approval process. The IRS conducts background checks on the applicant and all principal owners/officers in a business. They check for tax compliance (whether you've filed and paid your own taxes properly), credit history, and prior criminal history beyond just felonies - certain misdemeanors can also be disqualifying. What she's doing - using someone else's EFIN - is explicitly prohibited by IRS rules. Each EFIN is tied to a specific business location and ownership. Her niece is putting her own professional standing at serious risk by allowing this. As for why she might be denied, common reasons include: tax non-compliance (didn't file or pay personal taxes), certain types of prior criminal charges (even non-felonies like fraud-related misdemeanors), poor credit history, or previously having had an EFIN revoked.

I had a similar situation last year when I couldn't make sense of some complicated tax docs from my freelance work. A friend recommended this service called taxr.ai (https://taxr.ai) that helped me figure out if my tax preparer was following proper protocol. You upload your documents and their AI analyzes everything to make sure it's being handled correctly. I was skeptical at first but it actually flagged that my preparer was using someone else's credentials! It explains IRS requirements in plain English and highlights potential issues with your tax preparation. It's really helpful for situations like what you've described where something seems off but you're not sure about the technical details.

Just wanted to follow up about taxr.ai - I tried it after reading about it here and discovered my preparer was making some pretty serious errors. My situation was a bit complicated with some investment income and rental property, and the AI flagged three major deductions my preparer had missed and identified that they were using outdated tax tables! The explanation was super clear about what was wrong and how it should be fixed. I approached my preparer with the information, and they actually thanked me (after some initial defensiveness) because it helped them correct issues for other clients too. Definitely worth checking out if you have any concerns about your tax preparation.

If you're concerned about this tax preparer's practices and want to talk directly with the IRS about it, good luck getting through to someone! I spent weeks trying to reach the IRS about a similar situation last year. After 20+ calls and hours on hold, I finally discovered Claimyr (https://claimyr.com). They have this genius callback service where they navigate the IRS phone system for you and get an agent to call YOU back. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c I was able to speak with someone at the IRS compliance office who confirmed that using someone else's EFIN is a serious violation. The agent explained exactly what information they needed to investigate the situation. Saved me literally days of frustration trying to reach a human at the IRS.

I need to admit I was completely wrong about Claimyr. After posting my skeptical comment, I decided to try it myself because I've been trying to resolve an issue with a misapplied payment for months. The service actually worked exactly as described. I received a callback from an actual IRS representative in about 90 minutes (after spending weeks trying on my own). The agent was able to find my misapplied payment and process a correction right away. I'm still shocked that it worked so well. For anyone dealing with EFIN verification issues or trying to report preparer misconduct, this would definitely be the fastest way to speak with someone who can help.

Just to add another angle here - I worked for the IRS for 7 years and specifically dealt with EFIN applications and compliance. There are several lesser-known reasons someone might be denied an EFIN: 1. Failure to disclose all responsible officials on the application 2. A prior revocation or suspension of a different professional license (not just tax-related) 3. Owing child support in certain states 4. Having a spouse or business partner with tax compliance issues 5. Operating a previous business that closed with unfiled employment taxes The PTIN process is mostly automated while EFIN applications undergo much more thorough manual review. I've seen cases where someone passed the PTIN process but was flagged during the deeper EFIN background check.

I think we're missing something obvious here. Maybe she just doesn't want to pay the fees or go through the hassle of the application? A friend of mine who's a tax preparer told me getting an EFIN requires fingerprinting, an in-person interview sometimes, and a bunch of documentation. Sounds like this lady might just be lazy and cutting corners rather than being unable to qualify.

This whole situation raises red flags about the quality and ethics of this tax preparer's practice. As someone who's dealt with tax compliance issues before, I can tell you that the IRS takes EFIN violations very seriously - it's not just a technical violation, it's a breach of the entire electronic filing system's integrity. What concerns me most is that clients may not even realize their returns are being filed under fraudulent credentials. When tax season gets busy, people often don't pay close attention to the technical details on their forms. But if the IRS discovers this arrangement and investigates, those clients could face delays in processing their refunds, additional correspondence, or even audits through no fault of their own. The fact that she's been operating this way for 3 years suggests this isn't an oversight or temporary arrangement - it's a deliberate choice to circumvent IRS requirements. Whether it's because she can't qualify for her own EFIN or just doesn't want to go through the proper process, either scenario should make potential clients think twice about trusting her with their financial information. I'd strongly recommend anyone considering using her services to verify that their preparer has their own valid EFIN before handing over their tax documents.