California tax preparer bond for CTEC registration
A California tax preparer bond is the surety bond in Business and Professions Code section 22250.1. The principal sum is $5,000. It runs in favor of the people of the State of California. It is a consumer-protection bond for a person who prepares returns for someone else. It is not an insurance policy for the preparer, and it is not a license or a state endorsement. Insurance City Agency, LLC, CA Lic #6003045, handles this bond from Stockton. Call (209) 670-1556.
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Who must carry the $5,000 bond, and who is exempt?
A person who prepares a return for someone else for a fee, or who holds out that service, is a tax preparer under section 22251 and needs the $5,000 bond in section 22250.1 unless section 22258 exempts that person. A clerk who only prepares the employer's own returns is outside that definition.
Section 22258, amended by Statutes of 2025, chapter 329 (SB 788), effective January 1, 2026, exempts a current Board of Accountancy licensee and a person authorized under Article 5.1 from section 5096; a licensed accounting firm and its partners, shareholders, owners, and employees; an active California lawyer; a trust company or trust business; a regulated financial institution only where its tax work is examined; a person enrolled to practice before the IRS; a supervised employee whose exempt supervisor reviews, signs, and is responsible for the return; and an employee of a tax-preparer entity in section 22251(a)(1)(B).
Except for trust-company and regulated-bank staff, that employee exemption applies only when a licensee, a licensed firm, an active California lawyer, or an enrolled agent signs every return. That employee may not sign unless otherwise exempt or registered with the council. Typing tax data counts as preparing a return. The 2025 amendments apply to taxable years beginning on or after January 1, 2025. Section 22259 repeals the chapter on January 1, 2028.
What does the bond pay, and what is it not?
The bond benefits a person hurt by fraud, dishonesty, misstatement, misrepresentation, deceit, or an unlawful act or omission by the preparer or by someone employed or associated with that preparer. The surety's aggregate for any one preparer does not exceed $5,000. It is not a license, and it is not an insurance policy for the preparer.
That $5,000 is the principal sum in section 22250.1, not a premium. A later change is not cumulative, and the surety does not pay penalties, fines, or attorney's fees. Section 22253(a)(6) bars advertising that the bond implies a state license. The current text requires proof that the individual is at least 18 before the surety issues the bond; CTEC's legislative authority page reproduces it.
How does a firm bond differ from one preparer's bond?
A preparer employed or associated with another tax preparer is covered by that preparer's bond. The filer must name each of those preparers and give the surety the age proof in section 22250.1(a). The total bond required for one preparer and the people employed or associated with that preparer is not required to exceed $125,000.
Those are two ceilings in section 22250.1(c). The $125,000 figure limits the bond the firm must maintain. The $5,000 figure limits what the surety pays for one preparer. Amend within 30 days when the roster changes. Section 22250.1(h) says the council posts a paid claim on and after July 1, 2019.
What must the preparer show the customer before starting?
Before any tax preparation service, section 22252 requires a writing with three items: the preparer's name, address, and telephone number; evidence of compliance with the bond, including the bond number if there is one; and the address of the council's website. Handing over a return later does not replace that writing. The customer is supposed to see the bond evidence first.
The council site is ctec.org. Section 22253(a)(11) treats a false bond number on that sheet as a violation.
How does the bond fit the 2026/2027 CTEC renewal?
According to CTEC, the 2026/2027 renewal opened August 1, 2026, and the date without a late fee is October 31, 2026. Late renewal runs through January 15, 2027. CTEC lists a $33 registration fee plus a $2 processing fee, and a $55 late fee if October 31 is missed. After January 15 the registration expires.
The bond is one checklist item. CTEC's October 15, 2026 page says to keep the bond and provide current bond information in the renewal, including a change or a claim. It also requires a current IRS preparer tax identification number. Finishing the hours, or reprinting the certificate, does not renew the registration. The preparer logs in, submits the application, and pays CTEC's fees. CTEC's September 3, 2026 note states the same opening date. Those amounts are CTEC's fees, not a bond premium.
How many education hours sit next to the bond?
Section 22255 sets both hour counts, and both require bond evidence before the council issues its paper. Qualifying education is at least 60 hours within the prior 18 months, 45 federal and 15 state. Annual continuing education is at least 20 hours, 15 federal and 5 California. Each certificate also needs the surety's name, the bond number, and the expiration date.
CTEC's October 15, 2026 page splits those 20 hours into 10 of federal tax law, 3 of federal updates, 2 of ethics, and 5 of California tax law. That is CTEC's description of the same 20. A person with two recent years of personal-return work may petition the council to treat that work as the qualifying hours. Work done in violation of the chapter, by someone neither registered nor exempt, does not count.
What happens if the bond cancels or lapses?
A tax preparer shall not conduct business without a current bond in the amount section 22250.1 sets. The surety must mail notice to the preparer and to CTEC 30 days before cancellation. If no new bond is in force on that date, the preparer stops until a new bond exists. Do not keep preparing returns for a fee in the gap.
There is no cash substitute. Notwithstanding Code of Civil Procedure section 995.710, section 22250.1(f) bars a deposit in lieu of bond. Section 22256 makes a violation a misdemeanor, with a fine not exceeding $1,000, up to one year in county jail, or both, except the paragraphs that section sets aside. Amend within 30 days when the roster changes.
How is the bond different from professional liability insurance?
The bond is a surety obligation for the consumer losses section 22250.1 names, capped at $5,000 aggregate for one preparer. It does not defend the preparer. Professional liability, or errors and omissions, is a policy for a claim that professional service caused a client a financial loss. The sections cited here require the bond. They do not require that policy.
This page does not price that policy or promise a payment. See professional liability. Notary bonds stay on the combined bond page.
Which of the three does which job?
Use the row that matches the question. The bond, the insurance policy, and the CTEC registration are three different duties. Having one does not complete the other two. Every figure in the bond row is from section 22250.1. The registration row follows section 22251.3 and CTEC's October 15, 2026 renewal page.
| Item | What it does | Who it protects | Who requires it |
|---|---|---|---|
| Tax preparer bond | $5,000 surety obligation for the conduct section 22250.1 names. Not a premium. Not a license. | A person damaged by that conduct. Payable to the people of the State of California. | Section 22250.1, unless section 22258 exempts the person. No cash deposit in its place. |
| Professional liability (E&O) | Insurance for a claim that professional service caused a client a financial loss, subject to the form. | The insured preparer, subject to the policy. This page does not promise a payment. | Not required by the Tax Preparation Act sections cited here. A client contract may still ask. |
| CTEC registration | Annual registration. For 2026/2027, renew by October 31, 2026, or late through January 15, 2027. | The public. Section 22251.2 says public protection is the council's highest priority. | Section 22251.3 and CTEC's renewal rules, including current bond information, hours, PTIN, and CTEC's fees. |
How do you get the bond, report it, and keep it current?
Do these steps in order. CTEC's October 15, 2026 page asks for current bond information in the renewal. This page does not describe an upload button that page does not name. A surety can decline. Nothing here promises that a bond will be issued.
- Check section 22251 and section 22258. An exempt CPA, lawyer, or enrolled agent does not use this bond to register with CTEC.
- Get the $5,000 bond from a surety admitted in California. Show proof of age 18. Do not offer a cash deposit.
- On a firm bond, name every preparer. The total required is not required to exceed $125,000. Amend within 30 days when the roster changes.
- Before preparing, give the section 22252 writing: name, address, telephone, bond evidence with the number, and the council website.
- In the renewal, provide the current bond information with the 20 hours and the PTIN. Log in, submit, and pay CTEC's $33 plus $2, or those amounts plus the $55 late fee after October 31, 2026.
- If a cancellation date is set, have the new bond in force that day. Until then, stop. Call (209) 670-1556 or use the contact form.
Sources
- Business and Professions Code, Chapter 14 (sections 22250–22259), read October 18, 2026. Bond 22250.1, definition 22251, customer writing 22252, violations 22253, education 22255, misdemeanor 22256, exemptions 22258 (SB 788, January 1, 2026), repeal 22259 on January 1, 2028.
- CTEC, October 15, 2026. Deadline October 31, 2026; late renewal through January 15, 2027; fees $33, $2, and $55; the 20-hour split; current bond information.
- CTEC, September 3, 2026. Renewal opened August 1, 2026. CTEC legislative authority page, read October 18, 2026: the current text of Chapter 14.
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