Question

A licensee shall not maintain a financial interest in or hold an employment position with any business entity that offers personal income tax preparation services, if any other person maintains a financial interest in the entity, or holds a management position involving authority over the business operations of the entity, and:

a. That persons's tax consultant or tax preparer's license has been permanently revoked.
b. The board has refused to issue or renew a license to that person.
c. Another state regulatory agency or the IRS has revoked or refused to issue or renew an occupational license, registration or permit held or requested by that person, for conduct involving tax preparation or dishonesty.
d. All of the above.

Answer 1

A licensee cannot be involved with a tax preparation business if another person associated with the entity has certain negative licensing actions against them, including permanent revocation, refusal to issue or renew a license, or similar actions by the IRS or other agencies.

Step-by-step explanation:

A licensee should not maintain a financial interest in or hold an employment position with any business entity that offers personal income tax preparation services under certain circumstances. Specifically, this prohibition applies if any other person involved with the entity:

• Has had their tax consultant or tax preparer's license permanently revoked,
• The board has refused to issue or renew a license to that person,
• Another state regulatory agency or the IRS has revoked or refused to issue or renew an occupational license, registration, or permit held or requested by that person, for conduct involving tax preparation or dishonesty,
• All of the above situations apply.

Occupational licenses serve as a verification of quality within labor markets, indicating that a professional has achieved certain educational or testing standards necessary for a particular field. About 29% of U.S. workers are in jobs that require such licenses, ensuring that professionals like doctors, lawyers, and tax preparers meet specific criteria to practice their professions. However, licenses can also act as barriers to entry and affect competition within the marketplace.