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AFSP – Am I exempt or non-exempt?

What does it mean to be "exempt"

The term "exempt" related to the IRS Annual Filing Season Program (AFSP) does not mean exempt from the the program itself.  It just means you are exempt from one part of the program:  the Annual Federal Tax Refresher (AFTR) course, which is a 6-hour course with a timed final exam.

The category of preparers called "credentialed preparers" are not expected to participate in the AFSP at all, and could be considered "exempt" from the entire program.

Who are credentialed preparers?

A credentialed preparer is a:

  • Certified Public Accountant,
  • Enrolled Agent,
  • Enrolled Retirement Plan Agent,
  • Enrolled Actuary or
  • Attorney.

The AFSP program is not intended for credentialed preparers who already possess a much higher level of qualification. These preparers are still allowed to participate in the program, and they are required to meet the same CE requirements as preparers in the exempt category.

Although there is no cost associated with obtaining a record of completion for the AFSP, and many credentialed preparers would already have the necessary CE to meet the standards, there is very little benefit to obtaining the record of completion. The database that the IRS is setting up of tax preparers with qualifications will already include practitioners with recognized credentials and higher levels of qualification and practice rights, if they are registered with the IRS.

Who is exempt from the AFTR course?

The IRS recognizes it that some individuals have already studied for and passed state based tax preparer certification tests. Additionally some preparers have obtained credentials that indicate they have a solid basic knowledge of federal tax law.

The following tax preparers are not required to take the basic level course called the Annual Federal Tax Refresher (AFTR) to meet the voluntary CE standards.

Registered Tax Return Preparers

Anyone who passed the RTRP test administered by the IRS from November 2011 to January 2013.

State registered return preparers

Return preparers who are active registrants of:

  • Oregon Board of Tax Practitioners
    • Licensed Tax Consultant (LTC)
    • Licensed Tax Preparer (LTP)
  • California Tax Education Council (CTEC) or
  • Maryland State Board of Individual Tax Preparers (MITP)

3  Certain credentialed professionals

Individuals who have obtained credentials from the Accreditation Council for Accountancy and Taxation:

  • Accredited Business Accountant/Advisor (ABA)
  • Accredited Tax Preparer (ATP)

Passed Part 1 of the Special Enrollment Exam for Enrolled Agents

Tax practitioners who have passed the SEE Part 1 within the past two years.

VITA volunteers

Quality reviewers and instructors with active PTINs.

What is the benefit of being classified as exempt?

If you are classified as exempt according to the classifications listed above, you are exempt from taking the Annual Federal Tax Refresher (AFTR) course. The AFTR course is a six hour course and in addition to completing the materials, you must pass a 100 question exam within a three hour time limit. You are allowed to retake the exam an unlimited number of times, however each exam must contain a mix of different questions.

In addition to saving six+ hours of your time, your spared the expense of purchasing an extra course.

Which courses should I take? 

After you determine if you are exempt or non-exempt, you can choose your CPE courses for your AFSP.  (Note:  feel free to call or email us if you are not sure about your status of being exempt or non-exempt).

If you want to take a package, choose between: If you want to pick and choose your own courses, review the hours needed here:

Note:  the CE requirements are the same for 2016 as for 2015

Note that the CE requirements were lower when the AFSP program started in 2014 because the program started in the middle of the year and the requirements were prorated.  From 2015 onward, the CE requirements are expected to be the same every year

Remember, you must complete all courses by December 31st.

How can I be sure these are the right courses to take?

The IRS recognizes four categories of courses

Tax Law Update CE credits: this is a specific category of tax courses in the IRS system. The course should be labelled "Tax Update" or "Federal Tax Law Update."

Ethics CE credits: this is also a specific category in the IRS reporting system. The course is described as in the "Ethics" category.

Annual Federal Tax Refresher Course: This is a single courses that covers a specific outline of topics prescribed by the IRS. This course has very well-defined testing requirements as well as material.  This course is not accepted for credit for Enrolled Agents, as they are required to take more advanced courses.

Federal Tax Law CE credits: This is a general category for the IRS classification, that includes any Federal Tax law CE course, other than a Tax Update or the Annual Federal Tax Refresher Course.  You can select any of the courses from our Tax Courses sections for your Federal Tax Law CE credits, except the Annual Federal Tax Refresher Course.

question about CE courses required

Questions?  Feel free to call or email us if you are not sure which courses to take.

Yes we report your CE hours to the IRS We do report your CE hours earned to the IRS electronically.  We are an approved IRS CPE provider for Enrolled Agents and Tax Preparers.

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Which courses should I take for AFSP CPE?

As per the rules outlined by the IRS, qualifying Annual Filing Season Program CPE must be in the areas of:

  • Federal Tax Law (all AFSP)
  • Ethics (all AFSP)
  • Tax Law Update (exempt)
  • Annual Federal Tax Refresher/AFTR (non-exempt) This course only available June 1 to December 31 each year.

All FunCPE  tax courses qualify for AFSP Federal Tax Law CPE. Our ethics courses qualify for all required AFSP ethics CE.  *BUT* there are specific tax course requirements depending on whether you are Exempt or Non-Exempt.

You can:

Sign up for a tax package which includes ethics:

~ or ~

Select your individual courses using the Exempt or Non-Exempt requirements:

FunCPE exams are available online 24/7 to help you meet your CPE requirements on time. 

The Annual Federal Tax Refresher (AFTR) 6 hour course is only available June 1 to December 31 of each year.  All courses must be completed by December 31st in order to receive the AFSP designation.