What is an Enrolled Agent?
An “Enrolled Agent” is the ONLY FEDERALLY-LICENSED TAX PROFESSIONAL who has demonstrated special competence in tax preparation and also has UNLIMITED PRACTICE RIGHTS to represents any taxpayer regarding any tax matter before any IRS office.
Enrolled Agents are empowered by the United States Department of the Treasury to represent taxpayer before all administrative levels of the Internal Revenue Service for audits, collections, and appeals. Enrolled Agents have been regulated by Congress since year 1884.
ENROLLED AGENT STATUS IS THE HIGHEST CREDENTIAL THE IRS AWARDS.
Individuals who obtain this elite status must adhere to ethical standards and complete a minimum of 72 hour of continuing professional education every three years which gets reported to the IRS.
Only an average of 1/3 of the individuals taking the examination pass each year, allowing them to apply for enrollment and subject themselves to a background investigation.
Because of the difficulty in becoming Enrolled Agent and maintaining that enrollment, there are fewer than 34,000 Enrolled Agents in the United States. In contrast, there are about 375,000 certified public accountants (CPA) nationwide.
What are the differences between Enrolled Agents and other Tax Professionals?
Unlike Certified Public Accountants, (CPA) and attorneys, who may or may not chose to specialize in taxes, All ENROLLED AGENTS specialize in taxation. While CPA and Attorney are licensed by the STATES, Enrolled Agents are Federally-licensed by the United States Department of Treasury.
Enrolled Agents are Nation Tax Professional that is licensed FOR ALL THE STATES. Attorney and Certified Public Accountants, have State licenses, which can limit their practice ONLY TO STATE where they are licensed. An Enrolled Agent is considered a tax specialist, who sets them apart from Attorneys or CPA who do not always specialize in taxes.
Privilege and the enrolled agent
The IRS Restructuring and Reform Act of 1998 allow federally authorized practitioners (those bound by the Department of Treasury’s Circular 230 regulations) a limited client privilege. This privilege allows confidentiality between the taxpayer and the enrolled agent under certain conditions. The privilege applies to situations in which the taxpayer is being represented in cases involving audits and collection matters. It is not applicable to the preparation and filing of a tax return. This privilege does not apply to state tax matters, although a number of states have an accountant-client privilege.
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