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What exactly is an Enrolled Agent?

An Enrolled Agent (EA) is an individual who has demonstrated technical competence in the field of taxation.  EAs can represent taxpayers before all administrative levels of the Internal Revenue Service.

What does the term Enrolled Agent mean?

Enrolled means EAs are licensed by the federal government.  Agent means EAs are authorized to appear in place of the taxpayer at the Internal Revenue Service.  Only EAs, attorneys, and CPAs may represent taxpayers before the IRS.

How can an Enrolled Agent help me?

EAs advise, represent and prepare tax returns for individuals, partnerships, corporations, estates, trusts, and any entities with tax-reporting requirements.  EAs prepare millions of tax returns each year.  EAsx expertise in the continually changing field of tax law enables them to effectively represent taxpayers audited by the IRS.

What are the differences between EAs and other tax professionals?

Only Enrolled Agents are required to demonstrate to the Internal Revenue Service their competence in matters of taxation before they may represent a taxpayer before the IRS.  Unlike attorneys and CPAs, who may or may not choose to specialize in taxes, all EAs specialize in taxation.  EAs are the only taxpayer representatives who receive their right to practice form the United States government.  (CPAs and attorneys are licensed by the state.)

How does one become an Enrolled Agent?

The EA designation is earned in one of two ways: (1) an individual must pass a difficult two day examination administered by the IRS which covers taxation of individuals, corporations, partnerships, estates and trusts, procedures and ethics.  Next, successful candidates are subject o a rigorous background check conducted by the Internal Revenue Service; or (2) an individual may become an EA based on employment at the Internal Revenue Service for 5 years in a job where he or she regularly applied and interpreted the provisions of the Internal Revenue Code and Regulations.

Are EAs required to take continuing professional education?

In addition to the stringent testing ad application process, EAs are required to complete 72 hours of continuing professional education, reported every 3 years, to maintain their status, because of the difficulty in becoming an Enrolled Agent and keeping up the required credentials, there are fewer than 35,000 active EAs in the United States.

Are Enrolled Agents bound by any ethical standards?

EAs are required to abide by the provision of the U.S. Treasury Department Circular 230 EAs found in violation of the provisions may be suspended or disbarred.

Privilege and the Enrolled Agent.

The IRS Restructuring and Reform Act of 1998 allows federally authorized practitioners a limited client privilege. This privilege allows confidentiality between the taxpayer and the enrolled Agent under certain conditions,  The privilege applies to situations where the taxpayer is being represented in cases involving audits and collection matters.  It is not applicable to the preparation and filing of a tax return.  The new privilege does not apply to state tax matters, although a number of states have an account-client privilege.  Tax laws are subject to change at any time.

Contact Mary or Greg for the latest information at (513)474-4555.