On May 25, 2007, Congress amended §6694 to raise the penalty standards for tax return preparers (the "2007 Amendment"). 2 The 2007 Amendment was met by criticism in the practitioner community, primarily because the amendment - which required preparers to have a reasonable belief that a position is more likely than not correct - created a higher standard for preparers than for taxpayers under §6662, which generally requires taxpayers to have substantial authority to avoid a penalty with respect to non-tax shelter transactions. 3 After the 2007 Amendment, Treasury issued a series of notices and proposed regulations interpreting and clarifying the operation of §6694, 4 but this guidance could not correct the inconsistency between the tax practitioner and the taxpayer penalty standards. Congress stepped in, and on October 3, 2008, a new amendment to §6694 (the "2008 Amendment") was enacted. s The 2008 Amendment reduced the general return preparer penalty standard to substantial authority, although it retained a reasonable belief/more likely than not standard for tax shelter transactions, and re-established the parity between the penalty standards for return preparers under §6694 and for taxpayers under §6662. This article discusses the facets of the new preparer penalty, including who it affects, the standards governing conduct, and the preparer's ability to rely on information and advice from others in preparing returns.