Enrolled Agents Frequently Asked Questions Internal Revenue Service

An Enrolled Agent is a tax professional who just might be able to save you from terrible financial trouble. They are licensed professionals who go to bat for taxpayers who face asset forfeiture, are undergoing audits, or who want to file appeals for various decisions of the Internal Revenue Service. Specifically, those with this certification, similar to a certified public accountant, can represent taxpayers before the Internal Revenus Service. Enrolled agent status has a long history that dates back to the end of the Civil War. Since then, it has become a bona fide career with the benefits of technical experience, federal oversight of the practice, governmental oversight, and even their own publications. In fact, enrolled agent certification is the highest credential the Internal Revenue Service offers. In short – a tax professional, or tax preparer in the United States.

This will include previous tax returns, personal identification information, pass a suitability check and contact information. You will need to account for any past legal or taxation troubles. Once all of your information is accepted, you will receive your PTIN. A licensed enrolled agent has many duties and responsibilities, both to their clients and to the Internal Revenue Service. Failure to comply with rules can result in suspension, disbarment, or other penalties. Conceivably, criminal charges could be filed in extreme circumstances. However, you will enjoy a long and fruitful career and nearly unlimited earning potential in the private sector if you maintain an honorable practice.

EAs can expect more clients and continued job growth

Additionally, anyone who is interested in becoming an EA will need to pass a background check. The background check will consist of researching the candidate’s personal tax history. This is https://personal-accounting.org/ quite important considering the importance of ethics in this job role. The length of time required to become an enrolled agent is much less than the amount of time required to become a CPA.

When you take on a client, you should perform diligence to ensure that your work for them will not harm another current, or former, client. You are responsible for performing due diligence in all matters. You should verify that all facts and statements you receive from oral or written communication is true and valid.

Become an Enrolled Agent – Careers and Outlook

Another option is to work at the IRS for five years in a position where you were interpret and apply the tax code on a regular basis. There are few better ways for a fiduciary or financial advisor to differentiate themselves than by including is enrolled agent worth it tax preparation and consulting as part of their overall fee. To maintain your EA license, you are required to take 72 hours of Continuing Professional Education credits every three years, including 16 hours per year minimum.

You must know how to assess the profit/loss statements from your corporate client and understand all the applicable deductions it can take from taxable income each tax season. You will need to know all the filing requirements for corporations, as well as how they are created and funded. Some businesses provide ways for their employees to save for their retirement. These accounts may include instruments such as a 401 investment plan or some sorts of IRA savings plan. These plans offer limited tax incentives and, as such, have many requirements and restrictions that govern both the employees’ and business entities contributions. It was in private wealth services that, as a regional firm we were able to make very effective use of EAs. For all practical purposes, within that area of the practice, I considered it a CPA equivalent.