An Enrolled Agent (EA) is a federally authorized tax practitioner with technical expertise in taxation empowered by the US Department of Treasury. They can represent taxpayers before all administrative levels of the Internal Revenue Service (IRS). An enrolled agent can prepare tax returns, provide tax planning and consulting services, and represent taxpayers in IRS audits, appeals and collections. They are the highest-trained tax professionals in the United States. An EA has exceptional knowledge of the tax code and can help clients navigate tricky tax situations such as the tax implications of a divorce or buying and selling property.
Unlike CPA’s, Enrolled Agents are authorized to prepare and file tax returns in all 50 states. They help clients navigate the US tax code, crucially influencing taxpayers’ financial well-being and compliance with tax law, regulations, and representation. An enrolled agent has earned the privilege of representing taxpayers before the Internal Revenue Service by either passing a 3-part examination compromised of individual and business tax returns or by being an experiences form IRS employee. Once this has been obtained an enrolled agent must adhere to ethical standards and complete 72 hours of continuance education courses every three years.
A critical aspect of this role includes confirming that our clients, who own and operate businesses, maintain accurate and up to date records of their financial activities. Now, those policies vary from firm to firm, but all tax professionals have an ethical and due diligence responsibility – a duty – to expect their clients to maintain accurate and up to date books and records.
Enrolled agents have unrestricted freedom to choose taxpayers from any part of the United States as a client. They also have the freedom to choose tax matters and IRS offices to represent their clients. The IRS only gives out one credential – the EA. After passing the grueling 3-part exam, respect and being seen as a credible resource are benefits in the eyes of taxpayers and the IRS. Passing the exam is proof that you are knowledgeable in tax matters and should instill trust in an American taxpayer.
The Internal Revenue Service is constantly changing and updating the tax code to follow the changing times and political climate in the US. Enrolled Agents must be on top of all evolving tax laws since we work in them every day as tax practitioners.
Since income taxes aren’t going away, the role of an enrolled agent will always be needed. Enrolled agents have been around since the Civil War, giving competent representation to the American taxpayer and protecting their rights. Given the recent past and current state of the economy, more people find themselves needing help with tax obligations. The average taxpayer doesn’t understand the complex processes of tax, and IRS enforcement is on the rise.
Not all tax preparers have the right to represent clients in front of the IRS. Only attorneys, CPAs and Enrolled Agents, with unlimited representation rights, can represent you before the IRS on matters including audits, payments/collections issues, and appeals.
Enrolled agents have professional duties.
Enrolled agents have unrestricted freedom to choose taxpayers from any part of the United States as a client. They also have the freedom to choose tax matters and IRS offices to represent their clients. The IRS only gives out one credential – the EA. After passing the grueling 3-part exam, respect and being seen as a credible resource are benefits in the eyes of taxpayers and the IRS. Passing the exam is proof that you are knowledgeable in tax matters and should instill trust in an American taxpayer.
Enrolled agents have professional duties.
Duty to Clients through integrity and take appropriate measures to comply with all legal obligations, maintain confidentiality of client’s information and avoid conflicts of interest.
Enrolled Agents and CPAs are trained, experienced professionals who are held to high ethical standards. The difference between them is that an Enrolled Agent specializes in taxation and a CPA can specialize in taxation. An Enrolled Agent can best assist you with an IRS concern and provide bookkeeping work for tax return preparation. There are some states that will not allow anyone to file a return except a licensed Enrolled Agent or CPA to file a state return.
According to the National Taxpayer Advocate, during the 2023 filing season, taxpayer experience was vastly improved, but the IRS is still behind in processing amend tax returns and taxpayer correspondence. During the COVID-19 pandemic, the IRS closed offices and they all worked from home just answering phones but not processing tax returns, amendments and correspondence. And unfortunately, they are still behind. They hired more people to answer phones, but those same people process all mailed returns, amendments and correspondence, so all those got behind again. So, you might need to be patient a little while longer while they play catch up again.
The IRS has a directory of preparers with certain kinds of credentials, such as enrolled agents. That link is: https://irs.treasury.gov/rpo/rpo.jsf.
