What is an EA?
For a lot of people, they’ll only just have begun to hear this term and will think it’s a new credential. Actually, the EA is America’s earliest tax credential. Wiki has the details: Enrolled Agent (EA)
Enrolled agents (EAs) are America’s Tax Experts. EAs are the only federally licensed tax practitioners who specialize in taxation and also have unlimited rights to represent taxpayers before the IRS.
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 or more 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.
How can an enrolled agent help me?
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 at all administrative levels within the IRS.
Privilege and the enrolled agent
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.
Are enrolled agents required to take continuing education?
In addition to the stringent testing and application process, the IRS requires enrolled agents to complete 72 hours of continuing education, reported every three years, to maintain their enrolled agent status. NAEA (National Association of Enrolled Agents) members are held to a higher standard, they are obligated to complete 30 hours per year (for a total of 90 hours per three year period). Because of the expertise necessary to become an enrolled agent and the requirements to maintain the license, there are only about 53,000 practicing enrolled agents.
What are the differences between enrolled agents and other tax professionals?
Only enrolled agents are required to demonstrate to the IRS their competence in all areas of taxation, representation and ethics before they are given unlimited representation rights before IRS. Unlike attorneys and CPAs, who are state licensed and who may or may not choose to specialize in taxes, all enrolled agents specialize in taxation and are licensed to represent you to the IRS in any state across the country.
Are enrolled agents bound by any ethical standards?
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, attorneys, and certified public accountants before the IRS. NAEA members are also bound by a Code of Ethics and Rules of Professional Conduct of the Association.