Don’t Be a Casualty: How to Survive 2021 CPA License Renewal

Getting ahead of the rush to renew your CPA credential might be the most important thing on your 2021 to-do list.

When I was a captain in the Air Force, my wing commander would tell me that there are always casualties in large-scale operations. The 2021 CPA license renewal process is undoubtedly a large-scale operation, but I have plenty of information to help ensure you’re not a casualty of it.

All Illinois licensed and registered CPA credentials will expire on Sept. 30, 2021—period. No waivers, no extensions, no excuses. There’s no change in the number of live continuing professional education (CPE) hours required, either. You heard it here.

The first step in renewing your CPA credential is to ensure that the Illinois Department of Financial and Professional Regulation (IDFPR) has your current email address. This is necessary because the IDFPR has gone paperless, meaning you’ll no longer receive the yellow postcard renewal notice as you have in the past. Instead, you’ll receive your renewal notice in June via email from [email protected]. You can easily update your email address by going to https://www.idfpr.com/applications/licensereprint and clicking on the “Click Here to Change Your Email” link at the top of the page.

Remember: If you are a partner in a firm, it’s important that you renew your individual license in a timely manner so that the firm license can be renewed, as the firm license is tied to each partner’s individual license. If one of the partners has not renewed their individual license, the firm license will not be able to be renewed.

Right now is the perfect time to start knocking out the 120 hours of required CPE for licensed CPAs. Included in the 120 hours are four hours of ethics and, new for this renewal cycle, one additional hour of sexual harassment prevention training. You must have all CPE requirements completed by the time you renew your license. You’ll be asked to confirm that you’ve completed the required 120 hours of CPE during the online renewal process. Answer truthfully and retain documentation of your CPE hours for a minimum of six years as IDFPR internal auditors do perform CPE audits.

If you or your firm performed an audit, a review of historical financial statements, and/or examinations of prospective financial statements during the preceding three-year period, a peer review is also required for license renewal. Licensees impacted by this requirement should be mindful of the time required to satisfactorily complete a peer review before licensure renewal and get ahead of the process. The renewal deadline is September 30 for individual CPAs and November 30 for firms. The Illinois CPA Society’s Peer Review Alliance has communicated with impacted sole practitioners and firms letting them know they must engage a peer reviewer for peer review acceptance in time to renew their individual or firm license. In response to the coronavirus, the AICPA Peer Review Board granted automatic six-month extensions for those enrolled in peer review, but that extension does not apply to your required license renewal. If you need to complete a peer review, do not delay.

During the 2018 license renewal period, we were contacted by many licensed CPAs who wanted to switch to being registered CPAs. The registered CPA is an expired status that closed on June 30, 2012. No new applications are accepted for that designation. In other words, there is no way to become a registered CPA unless you were grandfathered in having applied for that title prior to June 30, 2012. If you did actively apply within that time period, you’re eligible for life to renew or restore your status as a registered CPA.

We also heard from licensees who wanted to change their status to CPA (inactive) because they didn’t complete the required 120 hours of CPE. For those of you considering that change, I encourage you to thoroughly review the limitations of this title. Once you’re inactive, you may use the CPA (inactive) title but you may not use any skills or competencies as a CPA unless you are performing governance functions on a non-profit volunteer board (but not serving as an audit committee financial expert). The use of CPA (inactive) is extremely limited in nature and shouldn’t be used as a way to forgo CPE requirements and continue practicing outside of the narrowly defined parameters. If you’re behind on your CPE hours at renewal time, it may be best to simply place your license on inactive status and then restore it with IDFPR as soon as you accumulate the required hours. You must refrain from using the CPA designation until the license has been fully restored. To request inactive status, your license must be in good standing (i.e., not expired).

2021 is shaping up to be another hectic year, and it will be easy to lose track of these licensing requirements in the rush of another complicated busy season. Take my advice and get ahead of these requirements so your CPA credential won’t be a casualty of the rush to renew.