Filing in Illinois or California? Read This First

September 21, 2006

UPDATE: Illinois WILL NOT Require Out-of-State CPAs to Get Illinois License When Filing

The Illinois Department of Financial and Professional Regulation is issuing an emergency rule (.PDF) to address a problematic situation that would have required out-of-state CPAs filing returns in Illinois to get an Illinois CPA license, even if the client was not located in Illinois. The rule states:

"An individual certified public accountant lawfully practicing in another state shall not be required to file notice for temporary practice or obtain registration as a certified public accountant under this Section so long as the individual CPA is temporarily practicing in this state incidental to practice in another state and does not solicit Illinois clients nor have a physical presence in Illinois."

Once approved by the Joint Committee on Rules, the emergency rule will be effective immediately and in force for 150 days.

CPAs from around the country contacted Illinois about the difficulties they would have submitting returns if a change was not made. On September 28, 2006, the American Institute of CPAs (AICPA) submitted a letter of concern (.PDF) to Illinois Gov. Rod Blagojevich on behalf of AICPA members.

Keep visiting the VSCPA Web site for the most current information on this topic. The VSCPA is monitoring the issue. For questions or concerns about licensing, please contact the Illinois Department of Financial and Professional Regulation. Do not contact the Illinois Board of Examiners, as previously reported.

California Safe Harbor Provision Extended Until 2010

A California assembly bill, currently awaiting Gov. Arnold Schwarzenegger's signature, would affect practice privilege conditions for out-of-state CPAs.

The bill would allow out-of-state CPAs to temporarily practice in California provided they do not solicit California clients or assert or imply they are licensed to practice in California, among other provisions. In addition, the bill would:

1. Allow out-of-state CPAs to sign a their names or firm names to tax returns even if not registered by the California Board of Accountancy (CBA).
2. Require that the ‘"safe harbor" period for late practice privilege notifications remain in effect until December 31, 2010. This allows out-of-state CPAs a grace period of five days to submit the Notification Form to practice public accounting in California to the CBA.

More information on the bill is available on this CBA tip sheet (.PDF). Please direct any questions or concerns to the California Board of Accountancy at (916) 263-3630.