October 30, 2016

How Do I Become an Enrolled Agent?

Have you always had a flair for numbers? Do you enjoy the consistency and structured concept of the tax system? A career as an Enrolled Agent might be right for you. These tax professionals are certified by the U.S Department of the Treasury to represent taxpayers in all capacities, whether that be through tax preparation or tax resolution. If you’re looking for a career that offers stable employment, great wages, and prestige, consider becoming an Enrolled Agent.

How Do I Become an Enrolled Agent? : eAskme
How Do I Become an Enrolled Agent? : eAskme

What Exactly Does an EA Do?

Enrolled Agents are tax practitioners that are authorized by the federal government. EAs are bona fide experts in the field of taxation, and they’re permitted to represent taxpayers before all the administrative levels of the IRS.

They can advise, represent, and prepare tax returns for a variety of clients, including individual taxpayers, small businesses, corporations, trusts, estates, and any other entity that is required to report their taxes. 

Two Main Paths to Becoming an Enrolled Agent

There are two main paths an individual can take to pursue a career as an EA; one sees an individual with a bachelor’s degree in finance or accounting-related disciplines.

However, a bachelor’s degree isn’t required for all candidates; those who have worked for the IRS for five years or more, in a position that requires them to consistently interpret tax code, are also eligible to become an Enrolled Agent.

Regardless of which path you choose, you’ll be required to follow some basic steps in pursuit of your EA licensure. First, you’ll need to obtain your Preparer Tax Identification Number (PTIN). This is accomplished through an application that requires your SSN, personal or business information, your previous year’s tax return, explanations about any lingering tax obligations or felony convictions, and any other certification you may have in the field of accounting or finance.

You must then apply to take the Special Enrollment Examination, known as SEE. Note: Those who have worked for the IRS are often exempt from this exam, so be sure to do your research if you’re in this faction.

Taking the SEE

The EA Exam (known as SEE)is a lengthy test an individual must pass in order to become an Enrolled Agent. It’s composed of three parts, and you must pass all three in order to secure your distinction. The EA Exam can be difficult to pass, and some find they must take it over and over again; that’s why it’s important to learn best practices on how to pass the EA Exam before sitting for it the first time.

In 2015, the pass rate for the first part of the exam was 77 percent, the second came in at around 60 percent, and the third part at 87 percent. The first part of the test deals with individuals, the second with businesses, and the third with Representation, Practice and Procedures. Each portion of the test contains about 100 questions, and there are some questions included that are experimental.

These are not scored, and are used merely in preparation for the next round of testing. In order to pass the SEE Exam on the first round, many find they must take review courses that include mock exams and study guides.

After the Exam

After achieving passing scores on all three sections of the exam, you must then apply for enrollment through the IRS. You’ll be required to pay an enrollment fee, which can be electronically or through the mail.

After mailing the completed form, you’ll then be subject to a tax compliance check that will ensure you’ve filled all necessary returns and do not have an outstanding tax debt.

Keep in mind that passing the SEE doesn’t mean you’re out of the woods when it comes to education and requirements. To remain licensed as an EA, you’re required to complete 72 hours of continuing education every three years.

So long as you retain this status, you are permitted to represent taxpayers before the IRS. There are numerous EA job opportunities, so get on the path to success today by following these steps.