Annual Federal Tax Refresher Course

Overview

The Annual Federal Tax Refresher (AFTR) is part of the IRS Annual Filing Season Program (ASFP).

If you are classified as Non-Exempt (most people are), you must pass the AFTR exam as part of your continuing education package.

The AFTR course becomes available on June 1st.

All courses must be completed by December 31st.

How hard is the AFTR course?

Although the course is completely open book, the following make it fairly difficult:

  • time limit of 3 hours
  • 100 questions in random order
  • new questions if you have to retake the exam
  • you can never see which questions you missed
  • limited to 4 attempts

Don’t get discouraged: we’ve found that more students miss the December 31st deadline than can’t pass the exam.

Strategies to pass the AFTR course

  1. Print out the PDF material (usually around 110-130 pages)
  2. Review the material to become completely familiar with it and how it’s organized
  3. Use post-it note tabs to mark the sections–to make it easier to find something when you are under the time crunch of taking the exam
  4. Get started early: do not miss the December 31st deadline to complete ALL courses

You will not have time to look up every answer–so you must know the answer to some, and be able to quickly look up the answer to the rest.

Important deadline for AFSP Record of Completion

The IRS requires CE sponsors to offer the AFTR course in the second half of the year so that tax preparers receive updated training.

As a result, our AFSP Tax Packages are available on our site from June 1st to December 31st.

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All courses must be completed by December 31st

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AFSP Tax CE Packages

AFSP-Exempt Tax Package #5

AFSP-Non-exempt Tax Package #6

View AFSP Tax Packages

Are you exempt or non-exempt?

Find out which category you are in here.  The only difference in CE requirements is non-exempt tax preparers must take the 6 hour AFTR course, while exempt tax preparers take the 3 hour tax update course.

The AFTR course is a timed 3 hour exam with 100 randomly selected questions, in accordance with IRS regulations.

Test format

  • 100 multiple choice questions
  • Questions in random order
  • Cannot print exam
  • Completely open book
  • Time limit of 3 hours from start
  • New questions if you retake the exam
  • Limited to 4 total attempts

Eligibility

AFTR course covers

  • New tax law
  • General review
  • Tax practices

New legislation enacted after publication of this outline (on 02/21/24) may be voluntarily incorporated into the course.

2024 Annual Federal Tax Refresher (AFTR) Course Outline

(For Preparation of 2024 Individual 1040 Tax Returns)

Domain 1 – New Tax Law/Recent Updates*

1.1 Annual inflation and cost of living adjustments (Rev. Proc. 2023-34)
1.2 New standard mileage rates (Notice 2024-08)
1.3 Third-Party Network Transaction (Form 1099-K) reporting requirements (FS-2023-27) (IR-2024-33)
1.4 Resume issuing automated reminder notices for balances due for taxable years 2021 and earlier (Notice 2024-07)
1.5 Direct File Pilot Program (Directfile.IRS.gov)
1.6 SECURE 2.0 Act, Section 325, Roth plan distribution rules effective for 2024
1.7 SECURE 2.0 Act, Section 603, Catch-up Contributions effective for 2024

 

Domain 2 – General Review

2.1 Filing Status Review (including a reminder for Filing Status qualifying widow(er) now qualifying surviving spouse)
2.2 Taxability of earnings (such as wages, salaries, tips)
2.3 Schedule B: interest, dividends, foreign accounts, and trusts
2.4 Reporting and taxability of retirement income (Social Security benefits, pensions, annuities, 401(k) distributions)
2.5 IRAs (contributions, deductions, distributions and 10% penalty)
2.6 Reporting and taxability of unemployment compensation
2.7 Alimony (divorce agreements executed before 2019; executed or modified after 2018)
2.8 Schedule C, Profit or Loss from Business (Sole Proprietorship)
2.8.1 Determination of gross income & deductions
2.8.2 Business versus hobby
2.8.3 Business use of home (regular vs. simplified method)
2.8.4 Recordkeeping requirements
2.8.5 Entertainment expenses (50% of business meals deductible)
2.8.6 Section 179 expense limits
2.8.7 Depreciation
2.8.7.1 Bonus depreciation (including new 60% limit)
2.8.7.2 Luxury auto depreciation limits
2.8.7.3 Listed property updates
2.9 Schedule D and Form 8949, overview of capital gains and losses
2.10 Standard Deduction
2.11 Schedule A, Itemized deductions
2.11.1 Medical and dental expenses
2.11.2 State and local tax deduction ($10,000 married/$5,000 married filing separate)
2.11.3 Home mortgage interest and home equity loans
2.11.4 Charitable contributions
2.11.4.1 60% AGI limit for cash contributions
2.11.4.2 Contemporaneous written acknowledgment required for contributions of $250 or more (cash or property)
2.11.5 Federally declared disaster area casualty loss deduction (including loss deduction for non-itemizers)
2.11.6 Moving expense deduction suspended and reimbursement taxable (except for active military)
2.11.7 Recordkeeping and documentation of deductions
2.12 Tax credit eligibility (child tax credit, credit for other dependents, child and dependent care tax credit, education tax credits,
earned income tax credit)
2.13 Energy credits (Energy Efficient Home Improvement Credit, Residential Clean Energy Property Credit)
2.14 Clean vehicle credits (IRC 30D(g), 25E(f) and (Rev. Proc. 2023-33)

 

Domain 3 – Practices, Procedures and Professional Responsibility

3.1 Tax-related identity theft (Pub. 5199)
3.2 Safeguarding taxpayer data (Pub. 4557)
3.3 Overview and expiration of Individual Taxpayer Identification Numbers (ITINs) (Pub. 1915)
3.4 Preparer penalties (inflation adjustments to penalty amounts found in (Rev. Proc. 2023-34)
3.5 Tax preparation due diligence (for filing as head of household, earned income tax credit, child tax credit, and American
opportunity tax credit)
3.6 E-file requirements (no pay stub filing, when to get signature form, timing for handling rejects)
3.7 Annual Filing Season Program
3.7.1 Annual Filing Season Program Requirements (Rev. Proc. 2014-42) (Pub. 5227) (Pub. 5646)
3.7.2 Circular 230 and consent to be subject to Circular 230 rules
3.7.3 Limited representation

 

Other information

*Course material should only include the subject areas on the AFTR course outline. New legislation enacted after publication of this outline (published 2/21/24) may be voluntarily incorporated into the course. You should test on the most current/accurate material you presented in the course.

**Please remind course participants to log into their PTIN account and sign the Circular 230 Consent statement in order to participate and receive their Annual Filing Season Program – Record of Completion.

See these directions on how to sign the Circular 230 Consent statement