Most states do not require a state license for non-credentialed paid tax preparers. The universal baseline is a federal PTIN at $18.75 per year, renewed annually at irs.gov/ptin. Beyond that baseline, state rules vary on two fronts that directly affect how you operate: whether a state mandates its own registration or credential (currently California and Oregon), and the local tax complexity your clients face (e-file volume thresholds, local income taxes, and specialty niche income such as tribal trust land, oil and gas royalties, or capital gains surtaxes). This guide maps both dimensions for all 31 states where Americas Tax Professionals maintains detailed coverage.
At a Glance: State Requirements Summary
The table below covers every state in our guide network. "License Required" reflects mandatory state registration for non-credentialed paid preparers. "E-File Threshold" is the return count at which a preparer must electronically file all state returns. "Notable Complexity" flags the single highest-impact issue for each state's client base.
| State | License Required | Top Tax Rate | E-File Threshold | Notable Complexity |
|---|---|---|---|---|
| Alabama | No | 5.0% | 10+ returns | Fort Rucker/Redstone military |
| Alaska | No | No income tax | 10+ returns | PFD reporting; commercial fishing and oil and gas income |
| Arizona | No | 2.5% flat | 10+ returns | Lowest flat rate in US |
| Arkansas | No | 3.9% (3.7% in 2026) | 10+ returns (individual); business returns must e-file | NW Arkansas RSU complexity; 50% LT cap gains exclusion |
| California | Yes (CTEC) | 13.3% | 100+ returns | Unique state registration |
| Colorado | No | 4.4% flat | 10+ returns | TABOR refund credits |
| Connecticut | No | 6.99% | 10+ returns | Complex part-year rules |
| Delaware | No (but $75 occupational license) | 6.6% | No mandate | Wilmington 1.25% city wage tax; banking/pharma complexity |
| Florida | No | No personal income tax | 10+ returns | 5.5% C-corp income tax; doc stamp tax on real estate |
| Georgia | No | 5.49% flat | 10+ returns | OBBBA tip deduction adopted |
| Hawaii | No (but VPID required) | 11% top (12 brackets) | No mandate confirmed | GET 4.712% on prep fees; VPID from DOTAX required; Act 46 doubles std deduction TY2026 |
| Idaho | No | 5.3% flat | 10+ returns | 60% LT capital gains deduction; precious metals exempt |
| Illinois | No | 4.95% flat | 10+ returns | Chicago local tax |
| Indiana | No | 3.05% flat | 10+ returns | County income taxes |
| Iowa | No (but 15 CE hrs required at 10+ returns) | 3.8% flat | No state mandate | CE + PTIN report (Form 78-012) required at 10+ returns |
| Kentucky | No | 4.0% flat | 10+ returns | Local occupational taxes |
| Kansas | No | 5.58% top | 50+ returns (90% must e-file) | Wichita aviation K-26 credit; oil and gas; SS fully exempt |
| Louisiana | No | 3.0% flat | 10+ returns | Oil and gas royalties |
| Maine | No | 7.15% top (3 brackets) | 10+ returns | Graduated tax; bonus depreciation decoupling |
| Maryland | No | 5.75% | 10+ returns | County income taxes (all counties) |
| Massachusetts | No | 5.0% flat | 100+ returns | Fair Share surtax at $1M+ |
| Michigan | No | 4.05% flat | 10+ returns | City income taxes |
| Minnesota | No | 9.85% | 10+ returns | Complex credit/subtraction system |
| Mississippi | No | 4.4% flat (4.0% in 2026) | 10+ info returns | SS fully exempt; tips and overtime do NOT conform to OBBBA; casino 3% final withholding |
| Missouri | No | 4.7% | 10+ returns | Federal income deductibility |
| Montana | No | 5.9% top (5.65% in 2026) | 25+ returns ($100/return) | Fed income tax deduction eliminated TY2024; SS taxable; QBI deduction decoupled from federal |
| Nebraska | No | 5.20% (4.55% in 2026) | 25+ returns ($100/return) | SS fully exempt TY2025; 40% capital gains deduction |
| Nevada | No | No income tax | 10+ returns | Modified Business Tax |
| New Hampshire | No | No wage income tax | 10+ returns | I&D tax 2% TY2025, eliminated TY2026 |
| New Jersey | No | 10.75% | 10+ returns | High property tax state |
| New Mexico | No (Albuquerque city ordinance) | 5.9% | 25+ returns ($5/return) | GRT on prep fees; military retirement fully exempt TY2026 |
| New York | No | 10.9% | 10+ returns | NYC local tax |
| North Dakota | No | 2.50% top (0% up to $48,475) | No mandate | OBBBA fully conforms; SS and all military pay exempt; Bakken royalty 1.75% withholding |
| North Carolina | No | 4.5% flat | 10+ returns | Growing tech sector |
| Ohio | No | 3.5% max | 10+ returns | 600+ municipal tax jurisdictions |
| Oklahoma | No | 4.75% flat | 11+ returns | Tribal income/oil and gas |
| Oregon | Yes (LTP/LTRP) | 9.9% | 10+ returns | Mandatory state registration |
| Pennsylvania | No | 3.07% flat | 10+ returns | 2,500+ local tax jurisdictions |
| Rhode Island | No | 5.99% top (3 brackets) | 100+ returns ($50/return) | OBBBA fully decoupled via HB 5076; SS cliff at $107k/$133,750; 16% EITC refundable |
| South Carolina | Bond only ($5,000) | 6.4% | 10+ returns | Surety bond required |
| South Dakota | No | No income tax | 10+ returns | Sales tax applies to prep fees at 6.2%; No. 1 trust situs jurisdiction |
| Tennessee | No | No income tax | 10+ returns | F&E tax for business clients |
| Texas | No | No income tax (constitutionally prohibited) | 10+ returns | Franchise tax on businesses (0.75% gross revenue, 0.375% retail/wholesale) |
| Utah | No | 4.45% flat | 101+ returns | Highest e-file threshold |
| Vermont | No | 8.75% top (4 brackets) | 10+ returns | Graduated tax; Dept. of Taxes administered |
| Virginia | No | 5.75% | 10+ returns | Federal contractor population |
| Washington | No | No income tax | 10+ returns | 7% capital gains tax over $270k |
| West Virginia | No ($30 business registration) | 4.82% (4.58% TY2026) | 25+ returns ($25/return) | SS 100% exempt TY2026; Marcellus shale royalties |
| Wisconsin | No | 7.65% | 10+ returns | Manufacturing tax credit |
| Wyoming | No | No income tax | 10+ returns | Severance tax on mineral extraction (oil 6%, coal 7%) |
Section A: Comprehensive State Guides
Each guide below covers the full picture for independent tax preparers: licensing or registration requirements, state income tax rates and structure, e-file mandates, local tax complexity, and market-specific planning considerations that affect your clients.
Full-Detail State Guides
California Tax Preparer Requirements
California is the only state outside Oregon that mandates registration for non-credentialed paid preparers. CTEC (California Tax Education Council) registration costs $33 per year and requires 20 hours of continuing education annually, including 10 hours of federal tax topics, 3 hours of ethics, and 2 hours of California law. The state's 13.3% top marginal rate is the highest individual income tax rate in the nation.
Alaska Tax Preparer Requirements
Alaska requires no state license for paid tax preparers, so a federal PTIN is all that is mandatory. There is no state income tax. The market complexity comes from Permanent Fund Dividend (PFD) reporting, commercial fishing income, oil and gas workers, and Alaska Native Corporation distributions, alongside military tax rules for service members stationed in the state.
Texas Tax Preparer Requirements
Texas imposes no state income tax and requires no state preparer license for non-credentialed preparers. The critical complexity for Texas preparers is the franchise tax (margin tax) for business entities, which affects LLC, corporation, and partnership clients. Texas is consistently among the top markets for independent preparer growth due to its large and diversified economy.
Florida Tax Preparer Requirements
Florida has no state income tax and no state preparer license requirement. Business clients face a 5.5% corporate income tax. Florida's large retiree population, growing small business sector, and multi-state worker flow from the Northeast make it a high-volume market for independent preparers.
New York Tax Preparer Requirements
New York does not require a state license for non-credentialed paid preparers, but its 10.9% top marginal rate and New York City's separate local income tax (up to 3.876%) make it one of the most complex individual income tax environments in the country. Preparers serving NYC clients must navigate both state and city returns for every affected filer.
North Dakota Tax Preparer Requirements
North Dakota requires no state license. The top rate is just 2.50%, with a 0% bracket on the first $48,475 (single) or $80,975 (MFJ). Social Security has been 100% exempt since TY2021. All military pay (retirement, active duty, Guard/Reserve) is exempt. North Dakota uses rolling IRC conformity, so OBBBA tips and overtime deductions flow through automatically. There is no volume-based e-file mandate for individual return preparers. Bakken oil royalty income triggers nonresident filing obligations with 1.75% withholding on gross royalties.
Maryland Tax Preparer Requirements
Maryland requires no state preparer license. Its 5.75% top state rate is accompanied by county-level income taxes assessed on every resident, adding a local layer to every individual return. Unlike Ohio and Pennsylvania where local taxes are city-specific, every Maryland county (and Baltimore City) imposes its own rate, which ranges from 2.25% to 3.2% depending on jurisdiction.
Oregon Tax Preparer Requirements
Oregon is the second state (after California) that mandates state registration for non-credentialed paid preparers. The Oregon Board of Tax Practitioners issues the Licensed Tax Preparer (LTP) and Licensed Tax Consultant (LTC) credentials. Preparing returns for compensation in Oregon without an LTP, LTC, or exempt credential is a civil violation. Oregon's 9.9% top marginal rate is among the highest in the country for non-no-income-tax states.
Connecticut Tax Preparer Requirements
Connecticut requires no state preparer license. Its 6.99% top marginal rate and complex part-year resident and nonresident rules create significant technical challenges for preparers serving Connecticut clients who split time between states, particularly those with New York City employment income subject to both CT and NYC taxation.
Delaware Tax Preparer Requirements
Delaware requires no state license but does require a $75 annual Occupational Business License from the Division of Revenue. The top rate is 6.6% on income above $60,000. Wilmington levies a 1.25% city wage tax on both residents and nonresident commuters. Delaware has no state e-file mandate for individual returns. The pension exclusion doubled to $25,000 for taxpayers age 60 and older starting TY2025 (HB 108).
Illinois Tax Preparer Requirements
Illinois requires no state preparer license and applies a flat 4.95% income tax rate to all residents. Chicago imposes its own local taxes, including the personal property lease transaction tax, that affect business and self-employed clients. Illinois does not conform to all federal deductions, requiring preparers to track addback items for affected clients.
Pennsylvania Tax Preparer Requirements
Pennsylvania requires no state preparer license and taxes income at a flat 3.07%. The defining complexity is the local earned income tax (EIT) system: more than 2,500 separate local jurisdictions (cities, boroughs, townships, and school districts) each impose their own EIT, administered through a network of tax collectors. Every Pennsylvania individual return requires local jurisdiction identification and filing.
Rhode Island Tax Preparer Requirements
Rhode Island requires no state license. Three brackets run from 3.75% to 5.99%. Rhode Island decoupled from all OBBBA individual provisions before the federal bill was even signed, via House Bill 5076 -- tips, overtime, the enhanced standard deduction, the senior bonus deduction, car loan interest, and bonus depreciation are all fully taxable in Rhode Island. The Social Security exemption is a cliff: filers above $107,000 (single) or $133,750 (joint) AGI receive no exemption at all. The e-file threshold is 100 returns, notably higher than most states.
Georgia Tax Preparer Requirements
Georgia requires no state preparer license. The state adopted a 5.49% flat tax rate in 2024 as part of a multi-year reduction path. Georgia conformed to several OBBBA provisions including the tip income deduction, making it one of the more favorable states for tipped-wage clients. Military income exemptions and active-duty nonresident rules add specialized complexity for preparers near Fort Benning and Fort Stewart.
New Jersey Tax Preparer Requirements
New Jersey requires no state preparer license. At 10.75%, it carries one of the highest top marginal rates in the country, combined with the highest average property tax burden of any state. Preparers serving NJ clients frequently navigate multi-state returns for workers commuting to New York City, along with New Jersey's unique inheritance tax and estate tax structure.
New Mexico Tax Preparer Requirements
New Mexico has no state license, but Albuquerque requires non-credentialed preparers to register with the city and file an annual Certification of Acknowledgment by February 1. Tax preparation services are subject to New Mexico's Gross Receipts Tax (GRT) at approximately 7.6% to 7.9% in Albuquerque. Military retirement becomes fully exempt starting TY2026. Social Security is exempt only if AGI is at or below $100,000 (single) or $150,000 (MFJ) -- a cliff, not a gradual phase-out.
Virginia Tax Preparer Requirements
Virginia requires no state preparer license and applies a graduated rate topping at 5.75%. Its client base is shaped by one of the densest concentrations of federal contractors, government employees, and active-duty military in the country, centered on the DC suburbs, Hampton Roads, and the Shenandoah Valley corridor. Military and federal retirement income planning is a high-value specialty in Virginia.
West Virginia Tax Preparer Requirements
West Virginia requires no state license but does require a $30 Business Registration Certificate. The top rate drops from 4.82% (TY2025) to 4.58% (TY2026), continuing one of the fastest rate-cut sequences in the country. Social Security goes from 65% exempt (TY2025) to 100% exempt for all taxpayers (TY2026). The e-file mandate triggers at more than 25 returns ($25/return penalty). Marcellus and Utica shale royalty income is the dominant complexity niche in northern WV.
Colorado Tax Preparer Requirements
Colorado requires no state preparer license and taxes income at a flat 4.4% rate. The TABOR (Taxpayer's Bill of Rights) mechanism creates annual refund credits that vary year to year, requiring preparers to stay current on the exact credit amount each filing season. Colorado's growing tech and cannabis sectors add specialized entity-level filing complexity for business clients.
Washington State Tax Preparer Requirements
Washington has no state income tax and no preparer license requirement. The defining complexity is the state's 7% capital gains excise tax on long-term gains above $270,000 (indexed for inflation), which took effect in 2022 and applies to high-income clients with investment portfolios, equity compensation, or business sale proceeds. The Business and Occupation (B&O) tax also affects self-employed and business clients.
Nevada Tax Preparer Requirements
Nevada has no state income tax and no state preparer license requirement. Business clients face the Modified Business Tax (MBT) on wages above a quarterly exemption threshold. Nevada's gaming, hospitality, and cannabis industries create specialized tip income, commission, and entity-level complexity for preparers in the Las Vegas and Reno markets.
Arizona Tax Preparer Requirements
Arizona requires no state preparer license and taxes income at a flat 2.5%, which is currently the lowest flat income tax rate of any state in the country. No local income taxes exist at the city level for individual residents. Arizona's growing population from California and its large retiree and military veteran communities create steady demand for independent preparers.
North Carolina Tax Preparer Requirements
North Carolina requires no state preparer license and applies a flat 4.5% income tax rate. The Research Triangle (Raleigh-Durham-Chapel Hill) technology and life sciences corridor drives demand for equity compensation and RSU planning. Military communities around Fort Liberty (formerly Bragg), Camp Lejeune, and Seymour Johnson Air Force Base provide additional specialized market opportunities.
Minnesota Tax Preparer Requirements
Minnesota requires no state preparer license. Its 9.85% top marginal rate is among the highest of states without a surtax, and the state operates one of the more complex systems of income subtractions, additions, and credits in the country. Preparers must track annually updated subtraction amounts for Social Security, pension income, and military retirement pay, all of which have separate eligibility calculations.
Michigan Tax Preparer Requirements
Michigan requires no state preparer license and taxes income at a flat 4.05% rate. City income taxes are levied by Detroit (2.4% residents, 1.2% nonresidents) and over 20 other Michigan cities including Grand Rapids, Lansing, Flint, and Saginaw. Every Michigan return with city wage income requires a separate city return in addition to the state return.
Ohio Tax Preparer Requirements
Ohio requires no state preparer license. The state income tax tops at 3.5% for income above $115,300. The dominant complexity is Ohio's municipal income tax system: more than 600 municipalities administer their own income taxes through RITA (Regional Income Tax Agency) or CCA (Central Collection Agency), with rates varying by city. Nearly every Ohio wage earner has both a state and at least one municipal return.
Wisconsin Tax Preparer Requirements
Wisconsin requires no state preparer license. The graduated income tax tops at 7.65%. Wisconsin's manufacturing and agricultural tax credit creates a significant planning opportunity for business owners in qualifying industries, with an effective 0% rate on qualifying manufacturing income. Preparers with manufacturing-sector clients should be well-versed in the credit's calculation and qualification rules.
Indiana Tax Preparer Requirements
Indiana requires no state preparer license and applies a flat 3.05% income tax rate. County-level income taxes are assessed on every Indiana resident, with each of the state's 92 counties setting its own rate. Preparers must identify each client's county of residence and apply the correct county tax rate when preparing Indiana returns.
Tennessee Tax Preparer Requirements
Tennessee has no state income tax on wages (the Hall Tax on investment income was fully repealed effective 2022) and no state preparer license requirement. Business clients face the franchise tax and excise tax (F&E), which apply to entities doing business in Tennessee. Tennessee is one of the fastest-growing states for net in-migration, creating a consistent pipeline of new clients for independent preparers.
Massachusetts Tax Preparer Requirements
Massachusetts requires no state preparer license. The base income tax rate is a flat 5%, but the 2022 Fair Share Amendment (Millionaires Tax) adds a 4% surtax on income above approximately $1 million annually, bringing the effective top rate to 9% on ordinary income and 9% on short-term gains for high-income clients. Massachusetts has a higher e-file threshold of 100 returns, matching California's threshold rather than the more common 10-return standard.
Additional State Guides
Alabama Tax Preparer Requirements
Alabama requires no state preparer license and applies a flat 5% income tax rate on income above $3,000 (single). No local income taxes are levied on individuals in Alabama. Military communities at Fort Novosel (formerly Fort Rucker) near Dothan and Redstone Arsenal near Huntsville represent high-value market niches, with full military retirement pay exemption providing significant planning value for retired service members.
Arkansas Tax Preparer Requirements
Arkansas requires no state license and has no e-file mandate for individual returns. The top rate is 3.9% for TY2025 (dropping to 3.7% for TY2026 under HB 1001). Arkansas provides a 50% exclusion on long-term capital gains. Northwest Arkansas (Bentonville/Walmart) generates significant RSU complexity. No OBBBA tips or overtime conformity: these items do not automatically reduce Arkansas taxable income.
Hawaii Tax Preparer Requirements
Hawaii requires no state license but mandates two registrations before serving any client: a federal PTIN (required by HRS 231-15.4) and a free Hawaii VPID (Verified Practitioner Identification Number) via Form PPS-12. Tax preparation services are subject to Hawaii's General Excise Tax (GET) at approximately 4.712%, making GET compliance the single most important state-specific obligation for Hawaii preparers. Hawaii has 12 income tax brackets ranging from 1.4% to 11%. Act 46 (SLH 2024) nearly doubles the standard deduction starting TY2026. Hawaii uses static IRC conformity dated January 1, 2025 and does NOT conform to OBBBA tips, overtime, or QBI deductions.
Idaho Tax Preparer Requirements
Idaho requires no state license and has no e-file mandate for individual returns. The TY2025 flat rate is 5.3%, with an OBBBA-conformed standard deduction of $15,750 single / $31,500 MFJ (HB 559, retroactive to TY2025). Long-term capital gains on qualifying Idaho property receive a 60% deduction. Precious metals and monetized bullion gains are fully excluded starting TY2025 (HB 40). The Boise/Treasure Valley tech boom (Micron) and California-to-Idaho migration are the dominant complexity drivers.
Iowa Tax Preparer Requirements
Iowa is unique: it requires no state license, but preparers completing 10 or more Iowa returns must hold a PTIN, complete 15 CE hours annually, and file Form 78-012 with the Iowa Department of Revenue by February 15. The TY2025 flat rate is 3.8%. Iowa inherited an important 2025 change: its standard deduction shifts to federal amounts in TY2026. Iowa's farmland capital gains deduction and fully repealed inheritance tax (January 1, 2025) are high-value planning areas.
Kansas Tax Preparer Requirements
Kansas requires no state license. Preparers completing 50 or more individual Kansas returns per year must e-file at least 90% of those returns. The top rate is 5.58% on income above $23,000 (single) or $46,000 (MFJ). Social Security is fully exempt for all taxpayers starting TY2024. The Wichita aviation industry K-26 credit, oil and gas severance complexity, and Fort Riley and Fort Leavenworth military communities are key preparer niches.
South Carolina Tax Preparer Requirements
South Carolina requires no state preparer license but does require a $5,000 surety bond for all non-credentialed paid preparers, filed with the SC Department of Revenue. The bond typically costs $50 to $75 per year in premium. South Carolina's graduated rate tops at 6.4%, with a rate cut to 5.21% taking effect for Tax Year 2026. Military retirement pay is fully exempt, making SC a strong market near Fort Jackson, Shaw Air Force Base, and Parris Island.
Mississippi Tax Preparer Requirements
Mississippi requires no state license. The flat rate is 4.4% on income above $10,000 in TY2025, dropping to 4.0% in TY2026 under the Build Up Mississippi Act (HB 1, signed March 27, 2025). Social Security is 100% exempt with no phaseout. Military retirement is 100% exempt. Mississippi does NOT conform to the OBBBA tip or overtime exemption -- those amounts remain fully taxable at the state level. The e-file threshold for information returns was lowered to 10 or more W-2/1099 forms starting TY2024.
Missouri Tax Preparer Requirements
Missouri requires no state preparer license and applies a top income tax rate of 4.7%. Missouri's distinctive feature is federal income tax deductibility: taxpayers may deduct a portion of their federal income tax paid from Missouri taxable income, requiring preparers to calculate the allowable deduction each year. Kansas City and St. Louis both impose local earnings taxes (1%) on residents and nonresidents who earn income within city limits.
Montana Tax Preparer Requirements
Montana requires no state license. The top rate drops from 5.9% (TY2025) to 5.65% (TY2026) under HB 337. A critical trap: Montana eliminated its federal income tax deduction starting TY2024 (SB 399) -- long-term Montana clients commonly still expect this deduction. Social Security is fully taxable using the federal combined income formula. Montana uses rolling IRC conformity so OBBBA flows through, but the Section 199A QBI deduction is explicitly decoupled: pass-through owners must add it back on the Montana return. E-file required at more than 25 returns ($100 per return penalty).
Nebraska Tax Preparer Requirements
Nebraska requires no state license. Preparers completing more than 25 returns must e-file all returns ($100/return penalty). Social Security is 100% exempt starting TY2025 under LB 754. The top rate drops from 5.20% (TY2025) to an effective 4.55% (TY2026), on the LB 754 path toward 3.99% in TY2027. Nebraska does NOT conform to OBBBA tips or overtime deductions.
Kentucky Tax Preparer Requirements
Kentucky requires no state preparer license. Its flat rate was 4.0% in 2025 and is scheduled to drop to 3.5% in 2026 under Kentucky's revenue-triggered rate reduction law. Local occupational taxes add complexity in Louisville and Lexington, where both city and county governments levy separate earnings taxes. Kentucky remains favorable for retirement income planning due to significant pension and Social Security exclusions.
Louisiana Tax Preparer Requirements
Louisiana requires no state preparer license and adopted a flat 3% income tax rate in 2025 as part of a major tax reform package. The state's defining complexity is its oil and gas economy: royalty income, working interest income, depletion allowances, and pass-through entity returns from the energy sector require specialized knowledge. Military and public retirement income exemptions also add planning value for preparers in the Baton Rouge, Shreveport, and Lake Charles markets.
Oklahoma Tax Preparer Requirements
Oklahoma requires no state preparer license and applies a flat 4.75% income tax rate. Two areas of high complexity distinguish Oklahoma: tribal income trust-land rules (income earned on tribal trust land by enrolled members of recognized tribes may be exempt from Oklahoma income tax under federal Indian law), and oil and gas depletion (the 22% percentage depletion allowance creates significant itemization and AMT considerations for energy-sector clients). Oklahoma's e-file threshold triggers at 11 or more returns, one above the common 10-return standard.
Utah Tax Preparer Requirements
Utah requires no state preparer license and taxes income at a flat 4.45% rate. Utah's e-file mandate triggers at 101 or more returns, the highest threshold of any state in the guide network. Utah's Silicon Slopes technology corridor (Salt Lake City, Provo, Lehi) creates high demand for equity compensation and RSU planning. Large-family tax credits and, for many clients, voluntary documentation of tithing for charitable deduction purposes are market-specific planning considerations unique to Utah's demographics.
South Dakota Tax Preparer Requirements
South Dakota requires no state preparer license and imposes no state income tax. The state-specific obligation that surprises new preparers is that South Dakota's sales tax applies to tax preparation fees at 6.2%, so preparers must collect and remit on their service revenue. South Dakota is also the No. 1 trust situs jurisdiction in the country, home to roughly $3.5 trillion in trust assets, which creates specialized work around dynasty trusts, directed trusts, and high-net-worth estate planning for preparers in the Sioux Falls and Rapid City markets.
Wyoming Tax Preparer Requirements
Wyoming requires no state preparer license and imposes no state income tax. The defining complexity for Wyoming preparers is the severance tax on mineral extraction (oil at 6% and coal at 7%), which creates specialized client work around royalty income, working interests, and depletion for oil, gas, and coal industry clients across the Powder River Basin and the broader energy economy.
Section B: Federal Requirements All States Share
Regardless of which state you practice in, four federal requirements apply to every paid tax preparer. Two are mandatory; two are optional but strategically valuable.
PTIN (Preparer Tax Identification Number) -- Mandatory
Every paid tax preparer must obtain and renew a PTIN annually. The 2026 renewal fee is $18.75 ($10.00 IRS base fee plus $8.75 third-party contractor fee). Renewal opens October 16 each year and is required before January 1 of the filing season. A PTIN must appear on every return you prepare for compensation. Apply or renew at irs.gov/ptin. See our full guide: How to Get a PTIN.
EFIN (Electronic Filing Identification Number) -- Required for E-Filing
If you plan to electronically file federal or state returns, you need an EFIN from the IRS. The application requires a suitability check (fingerprinting and credit/criminal background review) and takes 4 to 6 weeks to process. EFIN applications are submitted through IRS e-Services at irs.gov. You do not pay a fee for the EFIN itself, but you must use approved tax software to transmit returns. See our full guide: How to Get an EFIN.
AFSP Record of Completion (Annual Filing Season Program) -- Optional Credential
The IRS Annual Filing Season Program (AFSP) is a voluntary credential that grants limited representation rights before the IRS (representation of clients whose returns you prepared, during examinations, collection, and appeals). AFSP requires 18 hours of continuing education per year (6 hours federal tax law update, 10 hours other federal topics, 2 hours ethics) for non-exempt preparers. Completion earns an IRS Record of Completion and inclusion in the IRS public directory of credentialed tax professionals. See our full guide: Annual Filing Season Program (AFSP) Guide.
Circular 230 Obligations -- Applies to All Preparers
All paid tax preparers are subject to IRS Circular 230 (31 CFR Part 10), which governs standards of practice before the IRS. Key obligations include: due diligence in determining accuracy of returns and representations; prohibition against willful preparation of false returns; confidentiality of client information; and prohibition against charging contingent fees for return preparation. Violations can result in sanctions including suspension or disbarment from IRS practice, civil penalties, and referral for criminal prosecution.