What Is An Enrolled Agent? (EA)
An Enrolled Agent (EA) is a federally-authorized tax practitioner who has technical expertise in the field of taxation.
The Enrolled Agent is empowered by the United States Department of the Treasury to represent taxpayers before all administrative levels of the Internal Revenue Service for audits, collections, and appeals.
The Profession has been regulated by Congress since 1884.
The Enrolled Agent Exams are administered by Prometric on behalf of the IRS.
The National Association of Enrolled Agents was formed in 1972 and offers some great information and member services.
State organizations such as The California Society of Enrolled Agents also offer great information and member services.
TaxMama delivers one of the oldest and most comprehensive EA Exam review courses on the Internet and is recommended by NAEA.org.
Offered as both a live online interactive class and a recorded self-study class, the course does more than just focus on passing the exam, it teaches you how to be an effective Enrolled Agent (EA.) Here is a testimonial from a recent graduate:
“Just a note to say I really enjoyed your Review course, it was a huge help to me to relearn tax since passing the CPA exam back in 2000 and then winding up doing valuations. Awesome, awesome lectures, materials, and resources, just a wealth of great material. I passed all three parts of the EA on first attempt over a 6-wk period, and I found the combo of your lectures/slides, FastTax, and Mike Reed’s Excel review sheets were very helpful in passing.
Anyway, I have to compliment you on the service you are providing the EA community. Knowing what students face coming into this, I think this course is a great mix of tax prep and practical experience to help them pass and most importantly, start a practice. Very, very well done!”
– Tim Turley, CPA, Winter 2013
– What does the term “Enrolled Agent” mean?
– How does one become an Enrolled Agent?
– How can an Enrolled Agent help me?
– Privilege and the Enrolled Agent
– Are Enrolled Agents required to take continuing professional education?
– What are the differences between Enrolled Agents and other tax professionals?
– Are Enrolled Agents bound by any ethical standards?
– Why should I choose an Enrolled Agent who is a member of NAEA?
– How can I find an Enrolled Agent?
– Who should be an Enrolled Agent?
“Enrolled” means to be licensed to practice by the federal government, and “Agent” means authorized to appear in the place of the taxpayer at the IRS. Only Enrolled Agents, attorneys, and CPAs may represent taxpayers before the IRS. The Enrolled Agent profession dates back to 1884 when, after questionable claims had been presented for Civil War losses, Congress acted to regulate persons who represented citizens in their dealings with the U.S. Treasury Department. (Back to top)
How does one become an Enrolled Agent?
The license is earned in one of two ways, by passing a comprehensive examination which covers all aspects of the tax code, or having worked at the IRS for five years in a position which regularly interpreted and applied the tax code and its regulations. All candidates are subjected to a rigorous background check conducted by the IRS. (Back to top)
Enrolled Agents advise, represent, and prepare tax returns for individuals, partnerships, corporations, estates, trusts, and any entities with tax-reporting requirements. Enrolled Agents’ expertise in the continually changing field of taxation enables them to effectively represent taxpayers audited by the IRS. (Back to top)
The IRS Restructuring and Reform Act of 1998 allow federally authorized practitioners (those bound by the Department of Treasury’s Circular 230 regulations) a limited client privilege. This privilege allows confidentiality between the taxpayer and the Enrolled Agent under certain conditions. The privilege applies to situations in which 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. This privilege does not apply to state tax matters, although a number of states have an accountant-client privilege. (Back to top)
In addition to the stringent testing and application process, the IRS requires Enrolled Agents to complete 72 hours of continuing professional education, reported every three years, to maintain their Enrolled Agent status. NAEA members are obligated to complete 90 hours per three year reporting period. Because of the knowledge necessary to become an Enrolled Agent and the requirements to maintain the license, there are only about 46,000 practicing Enrolled Agents. (Back to top)
Only Enrolled Agents are required to demonstrate to the IRS 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 Enrolled Agents specialize in taxation. Enrolled Agents are the only taxpayer representatives who receive their right to practice from the U.S. government (CPAs and attorneys are licensed by the states). (Back to top)
Enrolled Agents are required to abide by the provisions of the Department of Treasury’s Circular 230, which provides the regulations governing the practice of Enrolled Agents before the IRS. NAEA members are also bound by a Code of Ethics and Rules of Professional Conduct of the Association. (Back to top)
The principal concern of the National Association of Enrolled Agents and its members is honest, intelligent and ethical representation of the financial position of taxpayers before the governmental agencies. Members of NAEA must fulfill continuing professional education requirements that exceed the IRS’ required minimum. In addition, NAEA members adhere to a stringent Code of Ethics and Rules of Professional Conduct of the Association, as well as the Treasury Department’s Circular 230 regulations. NAEA members belong to a strong network of experienced, well-trained tax professionals who effectively represent their clients and work to make the tax code fair and reasonably enforced. (Back to top)
How can I find an Enrolled Agent?
The easiest and fastest way to locate an Enrolled Agent in your area is to visit www.naea.org. The ‘Find an EA’ function located on the home page will allow you to search instantly by locality or specialty. You can also call 800-424-4339, the EA referral service. This is an unattended service, but you can request to receive your response by email, fax or mail and all calls are answered within 2 business days. You might also want to check in your local yellow pages under ‘Tax Preparation’, and look for the phrase ‘Enrolled Agent, Enrolled to Represent Taxpayers before the IRS’ or the ‘EA” credential following the professional’s name. (Back to top)
Surprisingly, just about anyone!
For some people, becoming an Enrolled Agent would be a wonderful career move.
Although you have to be bright, creative and ethical, you don’t need a college degree.
- Even someone right out of high school may sit for the exam.
- You don’t have to be a U.S. Citizen.
- You don’t even have to live in the USA – lots of American taxpayers outside the US need help.
- It’s a great way to support yourself through college – any number of tax firms would hire you – or start doing tax returns for your friends.
- Imagine a mother, working at home, near her children, on her own schedule
- Someone with physical disabilities can work from home and earn a real income.
- Love to travel? The EA certification is good anywhere in the USA – have modem, will travel!
- It’s like talking about Independence Day, right?
What Do you need?
- You need a good math aptitude.
- You need patience.
- You need to be able to move with change, quickly.
- You need an excellent memory to track all the changes – and to remember which ones become effective, when.
- You need a good network of tax professionals to help and guide you. (Like Team TaxMama)
- And you need a great imagination – to understand clients’ explanation and record-keeping systems – and IRS and state officials’ requests.
And most important of all – you need a great sense of humor! (Back to top)
For more information on Enrolled Agents and how to become one, read this article A Career Alternative – The Enrolled Agent