Enrolled Agent is a designation that enhances the careers of professionals and accountants who intend to specialize in tax.
Let’s know the step-by-step process of becoming an Enrolled Agent (EA).
- Understand the Enrolled Agent Designation
- Know the benefits of becoming an Enrolled Agent
- Obtain PTIN (Preparer Tax Identification Number)
- Schedule your test appointments
- Apply for enrollment
- Pass suitability test
Understand the Enrolled Agent Designation:
The word ‘Enrolled’ is defined as to be licensed by the federal government whereas ‘Agent’ means an authorized person to appear in the place of the taxpayer before the IRS.
Hence, Enrolled Agents are known as the federally-licensed tax practitioners who can possess technical expertise in taxation.
All the 50 states in the US recognize Enrolled Agent (EA) credentials and therefore the department of treasury grants the Enrolled Agent (EA) with having unlimited representative rights.
Know the benefits of becoming an Enrolled Agent:
The EA certification has 3 benefits:
Advanced status: EAs don’t work for taxpayers. Enrolled Agents have unlimited rights to represent the taxpayers even before the Internal Revenue Service.
Confirmed tax expertise: Both the certifications of Certified Public Accountant and Enrolled Agent are licenses. The state boards grant US CPA certification whereas the federal government grants EA certification. The Enrolled Agent expertise is acknowledged at a national level.
Public Trust: When compared to EAs the CPAs charge more. Most people need the aid of a tax expert at one point of time in their lives. Hence, there is a huge demand and trust for Enrolled Agents in the public.
Enrolled agent course fees in India: $181.94 per part.
Obtain PTIN (Preparer Tax Identification Number):
Here is the process of obtaining PTIN.
Create an account: You must have to create an account by providing your name, security question information, and email address.
Apply for PTIN: You can complete the online application by giving your previous year’s tax return information, your personal information, and professional credentials.
Pay your fee: Your application will transfer to the IRS partner bank where you need to make a payment of 36 USD by debit/credit card or with eCheck.
Schedule your test appointments:
- The candidate must have to visit the Special Enrollment Examination (SEE) web page in order to schedule the test appointments.
- Also, the candidate has to review the sample test questions, SEE candidate information bulletin, and other test preparation resources.
Apply for Enrollment:
Using pay.govform23, pay the fee and apply for enrollment. Then you have to mail the complete form to the Internal Revenue Service (IRS).
Pass suitability test:
The candidate has to pass the suitability check to ensure tax compliance in filing necessary tax returns, and there is no criminal background.
Note: Certain employees are exceptional from the exam requirement because of their past technical experience.
Renewal for Active Enrolled Agents:
A person who wants to become an EA must complete 72 hours of CPE (Continuing Professional Education) every three years. Also, include 16 hours of professional conduct every year. The IRS requires at least 3 hours of CPE. EA should renew their PTIN in the period of 16th October to 31st December every year.
Enrolled Agents can be admitted to practice during the three successive enrollment years of the cycle by preceding the renewal date. A person who is not satisfied with the renewal requirements will be placed on the inactive enrolled roster. The individual will be ineligible during the time before the IRS and may not imply to represent the taxpayers.
Continuing Education Requirements:
- Obtain 16 hours of professional conduct and ethics.
- Obtain 72 hours of CPE (based on renewal cycle).
- Use the IRS for the approval of a Continuing Education Provider.
How long does it take to become an Enrolled Agent?
Becoming an Enrolled Agent can take 3 to 8 months depending on your taxation knowledge.
Is the Enrolled Agent exam difficult?
The EA exam consists of three different parts with 3.5 hours of testing time for each part. Each of the exam parts contains 100 Multiple Choice Questions (MCQ’s) and covers a wide spread of taxation related topics.
The three parts of the EA exam are:
- Part 1: Individuals
- Part 2: Businesses
- Part 3: Representation, Practices & Procedures
EA Exam Passing Score:
The IRS sets the scaled passing score at 105, which corresponds to the minimum level of knowledge deemed acceptable by professionals practising before the IRS. Exam scores are confidential, and they are only revealed to the candidate.
The above article helps you to know the step by step process of becoming an Enrolled Agent and Enrolled Agent course details. Hope this article will be helpful for you. Any Questions? Comment below or you can directly contact Simandhar Education +91-7780273388.