License & Permit
Tax Preparer Bond
A tax preparer bond is a bond some states require before a paid preparer who is not a CPA, attorney, or enrolled agent can prepare tax returns for others.
- Required by
- State tax preparer regulators (in California, the California Tax Education Council)
- Bond amount
- $5,000 per preparer in California (Bus. & Prof. Code 22250.1)
What this bond guarantees
In California the bond is payable to the State of California for the benefit of anyone harmed by the preparer's fraud, dishonesty, misstatement, misrepresentation, or deceit. A harmed client files a claim, the surety pays valid claims up to $5,000 in total, and the preparer repays the surety.
Who needs it
- Registered tax preparers in California (CRTPs)
- Tax preparation businesses
- Seasonal and independent tax preparers
What the underwriter looks at
- Personal credit
- Prior claims
- Years preparing returns
Requirements vary by state and by who asks for the bond. Send us the request you received and we will confirm exactly what it calls for.
Common questions
Do CPAs and enrolled agents need this bond?
California exempts licensed CPAs, active State Bar attorneys, and IRS enrolled agents from the tax preparer act. Most other paid preparers need to register with CTEC and keep the bond.
Can I post cash instead?
No. California does not allow a deposit in place of the bond.
What if my bond is cancelled?
You must stop preparing returns for pay until a new bond is in place.