Enrolled agents (EAs) are federally-licensed tax practitioners who specialize in taxation and also have unlimited rights to represent taxpayers before the Internal Revenue Service. A person becomes an Enrolled Agent by either passing a stringent and comprehensive examination covering individual and business tax returns and representation of clients before the IRS or through experience as a former IRS employee. Our owner manager, Bob Franklin, passed this exam in 1993.
Enrolled agent status is the highest credential the IRS awards.
Individuals who obtain this elite status must adhere to the ethical standards outlined in Title 31 Code of Federal Regulations, Subtitle A, Part 10: “Regulations Governing Practicing before the Internal Revenue Service.” Enrolled agents, like attorneys and certified public accountants (CPAs), have unlimited practice rights. This means they are unrestricted as to which taxpayers they can represent, what types of tax matters they can handle, and which IRS offices they can represent clients before. Enrolled agents specialize in taxation. Because enrolled agents are federally licensed, they can practice anywhere in the United States.
Are enrolled agents required to take continuing professional education?
In addition to the stringent testing and application process, the IRS requires enrolled agents to complete 72 hours of continuing education every three years to maintain their licenses.
Are there really that many tax changes each year that might affect me?
Yes. Every year there are numerous changes to the tax laws and tax code. IRS Code sections now number from 1 to over 9,899 and encompass more than 72,500 pages.
Frequently, provisions are added while others expire. Some are indexed for inflation, so they change as well. Some are effective at the beginning of the year while others become effective on the date a particular bill or law is signed.
Because the tax code is always changing, enrolled agents take continuing education courses each year to keep up with the changes and also have research tools at their disposal to monitor updates. Most taxpayers do not have the time or the research tools to read the volumes of material that are added to or deleted from the tax code each year.
What are the key points to remember when hiring a tax professional?
- Always use a qualified professional to prepare your return.
- Preparers should always sign the returns and include their Preparer Tax Identification Numbers (PTINs). Tax professionals have to renew the PTIN every year.
- Beware of preparers who encourage you to lie or otherwise modify your information in order to get a bigger refund. We want you to get all the money back that you deserve and we are committed to this. However, because we are licensed to represent taxpayers before the Internal Revenue Service, we prepare tax returns that can be defended according to current tax law. Pay close attention to the next statement!
- The taxpayer is responsible for what’s on a tax return. Reputable preparers will ask to see receipts and will ask multiple questions to determine whether expenses, deductions and other items qualify. By doing so, they are trying to help their clients avoid penalties, interest or additional taxes that could result from an IRS examination.
- It is important to choose a tax professional, such as an enrolled agent, who keeps up with the rules and regulations and uses this expertise to do the best job possible for every taxpayer.