Faq (Frequently Ask Question)
What is an Enrolled Agent?
An Enrolled Agent is a "federally authorized tax practitioner". Licensing is issued by the Treasury Department giving the EA legal authority to prepare tax returns and represent taxpayers before the Internal Revenue Service.
What is the difference between an Enrolled Agent and a CPA?
Both the Enrolled Agent and Certified Public Accountant must pass multi-day written exams to be licensed, however, the EA exam focuses heavily on all aspects of taxation, whereas the CPA exam encompasses various areas of accounting with one section on tax. Licensing for CPAs is given by the state in which they practice whereas the E.A. is licensed by the IRS and can practice without state boundary restrictions.
How does an Enrolled Agent differ from any other tax preparer?
EAs are the only practitioners who are required to demonstrate competence specifically in matters of taxation. They are the only taxpayer representatives who receive that right from the U.S. government, rather than from individual states.
Are Enrolled Agents bound by any ethical standards?
The ethical standards which govern Enrolled Agents are covered in Treasury Department Circular 230 (Title 31 Code of Federal Regulations, Subtitle A, Part 10) and sets out, in detail, the governing rules, responsibilities, restrictions, sanctions and disciplinary actions when practicing before the Internal Revenue Service. This is the same governing instrument that regulates Attorneys, CPAs and others who represent taxpayers before the IRS.
Should I worry if my tax return gets audited?
Taxpayers typically panic when hearing that they are being audited. Unless you have falsified information or used questionable deductions there is generally no reason to worry. With a Power of Attorney, your Enrolled Agent will answer questions arising from the return that they prepared on your behalf. With the exception of a few aggressive agents, both the Internal Revenue Service and the Franchise Tax Board in California generally work with the taxpayer and/or practitioner in resolving tax issues. When in doubt call an Enrolled Agent.
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