While the profession continues to adapt to the changing business and social climate, the WSCPA Advocacy Team has spent the summer and fall working hard monitoring and participating in various rulemaking at different agencies which will impact the profession in the years to come. This work affects not only how CPAs maintain, and future CPAs obtain, their licenses but also the laws that CPAs need to consider when advising clients or their employers.

Preparing for changes to CPA exam, hearings

The Washington State Board of Accountancy (WBOA) has started the rulemaking process for two areas. The first would remove specific named references to sections of the CPA exam as well as a set number of sections within the exam. This will prepare Washington for the new CPA exam that will be rolled out in 2024 as well as make our laws flexible for any other changes to the exam in the future. The second rule they are actively working on affects the formal and brief adjudication proceedings licensed CPAs may have before the WBOA. There is still work to be done before they finalize language on this rule, but the intention is to make the administrative aspects of these hearings more efficient for the licensees involved and the Board members.

DOR and the capital gains tax

The team has also been monitoring and meeting with the Department of Revenue (DOR) on a number of rule changes they are proposing and reviewing for both new and existing tax laws. Most notably, WSCPA and several of our members were asked to participate in an ongoing series of meetings with the DOR around the newly passed capital gains tax and areas of ambiguity or issues within the new law that may need to be addressed with rulemaking. These talks are ongoing, and the formal rulemaking process has not been set (as of mid-September). DOR has not been issuing guidance on specific circumstances or fact patterns within the new law yet. However, if you or a client would like a tax ruling around the capital gains tax (or any other existing tax), you can send an email to rulings@dor.wa.gov and need not identify the specific client.

CPA-inactive

In addition to this work around rulemaking, the Advocacy Team has continued to work with the WBOA and others on the legislation we are planning to introduce next Legislative Session that would add a new license status titled “CPA-inactive.” This piece of legislation will set a timeline to finish the phaseout of certificates that had been started in 2001 when the last certificate was granted by WBOA. Current certificate holders who have not completed the experience requirements to become active CPAs will be moved to this new inactive status in July of 2024. Under this new status, the roughly 700 current certificate holders will retain the ability to conduct the same functions that they have legally been permitted to do with the certificate. The new status, however, will also give another option to CPA licensees who may prefer to step back from their active status without retiring or letting their license “lapse,” which are the only two current options. This will also bring Washington into parity with other states that do not have certificates and also have the CPA-inactive license status, and further relieve confusion related to mobility.

If you have any questions or would like to get more involved with the Advocacy Team and shape the future of the profession, please feel free to reach out to us and we can find ways for you to participate moving forward.

Mike Nelson is the WSCPA Manager of Government Affairs. You can contact him at mnelson@wscpa.org.

This article appears in the fall 2021 issue of the Washington CPA magazine. Read more here.