AICPA tells IRS of concerns about inclusion of tax return cost estimates.

In a letter to Internal Revenue Service Commissioner Mark W. Everson, the AICPA said it is very concerned about the negative ramifications emanating from the IRS's inclusion of tax return preparation cost estimates in the printed 2005 Form 1040 Instructions. The Institute refers to cost estimates included in a table listing estimates of the average preparation times and expenses associated with certain

Form 1040 schedules that have been self-prepared without tax software, self-prepared with tax software and prepared by a paid professional. Stating that the numbers do not reflect marketplace reality and will undermine contextual explanation, the AICPA said the cost estimates will prove problematic, misleading and counterproductive. In addition, the National Society of

Accountants wrote a letter to the IRS urging the agency to correct the tables. To help alleviate the potential problems, the AICPA recommended that the PDF versions contain information to provide more context for the estimates. The IRS has indicated it may decide to include some language that helps clarify the information. To learn more, see this month's CPA Letter public accounting supplements (access instructions are on page 2 or go to www.aicpa.org/pubs/cpaltr/jan2006/supps/index.htm).