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What is an Enrolled Agent?

Enrolled Agents are tax professionals licensed by the federal government (Internal Revenue Service). The history of Enrolled Agents dates back to 1884 when president Chester A. Arthur signed the Enabling Act. This Act provided rules to regulate persons who represent citizens in dealings with the Treasury Department.

Enrolled Agents specialize in taxation. They are involved in preparing, advising and representing all tax-reporting entities such as: Individuals, Partnerships, Corporations, Estates and Trusts.

EA’s have demonstrated technical competence in taxation by passing the EA test administered by the IRS. As a result, EA’s are in a special position to help taxpayers deal with the IRS.

How to become an Enrolled Agent
There are two tracks to becoming an enrolled agent. These tracks are described in Federal regulations con-tained in a pamphlet known as Treasury Department Circular 230, Regulations Governing the Practice of Attorneys, Certified Public Accountants, Enrolled Agents, Enrolled Actuaries, and Appraisers Before the Internal Revenue Service.

Written examination
You can become an enrolled agent by demonstrating special competence in tax matters by taking a com-puter based examination. This track requires that you:

• Apply to take the Special Enrollment Examination (SEE);
• Achieve passing scores on all parts of the SEE;
• Apply for enrollment; and
• Pass a background check to ensure that you have not engaged in any conduct that would justify the suspension or disbarment of an attorney, CPA, or enrolled agent from practice before the IRS.

IRS experience
You can become an enrolled agent by virtue of past services and technical experience with the IRS that qualifies you for enrollment. This track requires that you:

• Possess the years of past service and technical experience specified in Circular 230;
• Apply for enrollment; and
• Pass a background check to ensure that you have not engaged in any conduct that would justify the suspension or disbarment of an attorney, CPA, or enrolled agent from practice before the IRS.

Applying to take the exam
As of April 2006, Thomson Prometric is now the company who will administer the IRS exam. Information regarding how to apply to take the exam is available on the Thomson Prometric webpage at Prometric.com/IRS.
 

Benefits of becoming an Enrolled Agent

Already in the tax preparation business:
As you know, in the tax preparation business knowledge is king. Many believe there is a direct correlation between increased knowledge and increased fees. As an EA you can handle audits for your client and for clients that you did not prepare the return.

Start a new business:
Becoming a professional tax preparer can be an exciting and rewarding profession/business. It is an easy business to start and has a minimal capital investment. You can start part-time or buy an existing business. When you buy an existing business you use a portion of the money collected from clients to pay for the business. In other words, the business usually pays for itself. As an EA you will bring knowledge to your practice which means a higher value to your clients.

Benefits of networking:
As an EA you can become a member of your local and national Enrolled Agent societies. This will allow you to keep abreast of new developments in the field of taxation, practice management, and attracting new client’s etc.

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