Enrolled Agents vs CPAs vs Tax Attorneys: Which Tax Professional is Best for You

And then you will need a CPA review course, which could add more to the total costs of becoming a CPA. This makes a PA more unbiased and objective when analyzing and interpreting accounting information. The public accountant’s allegiance is with the public and therefore seeks to maintain professional accounting and general ethical standards due to the faith placed on them by the public. A public accountant is, therefore, the stepping stone on which regular accountants can become CPA’s, after 8-9 years and on passing the AICPA exam. She began her career as an investment banker at Lehman Brothers in New York and Morgan Stanley in Hong Kong.

Though all states haven’t mandated it, the exam has become increasingly common. Enrolled agents first appeared in 1884 due to issues arising with Civil War loss claims. The candidate has to pay around $1,000 in the process of taking the Special Enrollment Examination, paying for the Enrolled Agent license. EA certification appropriate fee structure is given in the below table.

Goal Setting, One Step at a Time

Since the IRS empowers enrolled agents with an unlimited right to practice on a federal level, enrolled agents can work with a client who may have filings across all states in the U.S. Therefore, they may have a tax specialization, such as tax preparation or resolution. For this reason, a CPA specializing in tax should consider earning the EA to demonstrate their tax expertise. Because the CPA Exam is so expensive to take, candidates usually invest quite a bit more in their review courses to better pass the exam on the first attempt. Therefore, we highly recommend candidates review the best CPA review discounts before purchasing their course as a way to keep more money in their pockets.

The enrolled agent exam focuses mostly on tax preparation matters and very little on accounting practices. In the 1880s, there were inadequate attorney standards, and Ccertified public accountants were not in existence. The enrolled agent profession began after fraudulent claims were submitted for Civil War losses. Congress took action to regulate EAs to prepare Civil War claims and represent citizens in their interactions with the Treasury Department. In 1884, the Horse Act was signed into law by President Chester Arthur to establish and standardize enrolled agents. EAs, or enrolled agents, are tax preparers authorized to represent taxpayers before the IRS.

CPA and EA Exams: Which is Harder?

Additionally, you are required to complete at least 72 hours of continuing education every three years. An Enrolled Agent prep course is definitely recommended to study with as the exam contains way too much information to try and go it alone. Here is a helpful comparison chart of the best Enrolled Agent courses on the market. People who don’t have the resources to pursue a taxation attorney often hire EAs instead of civil resolution cases. Not only do EAs rates tend to be more affordable, but they can also offer their tax law expertise to clients in tax proceedings, audit hearings, and appeals.

• Let’s take a look at the CPA vs EA requirement differences.
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• EAs help ensure clients are treated appropriately by the IRS, work out payment plans on the best possible terms, and ensure the IRS follows laws that protect taxpayers.
• You may be familiar with “CPAs”, or “Certified Public Accountants”.
• However, an enrolled agent is a federally-authorized tax practitioner rather than a state-licensed professional.

Both of these licenses are great options, but which one should you get. On the other hand, the CPA Exam has four parts and much broader Enrolled Agent Vs Cpa content. The section equivalent to the EA exam is Regulation , and only about 70% of the REG content directly relates to the EA exam.

EA vs CPA: Which is better?

Both types of professionals are equally qualified to perform similar tasks, but there are differences in the range of services offered. CPAs can provide a much wider scope of tax services than an EA can. What’s more, general population demand is greater for CPAs than EAs. DE, HI and VT do not support part-year/nonresident individual forms.

A person may be an EA and a CPA; however, one appointment does not necessarily qualify the person to serve as the other. CPAs’ duties and professional offerings are broader than an EA’s. You need to know the answer when you’re contemplating whether to earn the enrolled agent designation or the Certified Public Accountant certification. https://www.wave-accounting.net/ Tax Preparers looking to further their careers have several options open to them, and these are two of the most popular. Which one you choose will depend on your areas of interest and expertise. Additionally, you will need to decide how much time, money, and energy you must put into meeting the requirements.

What furloughed or unemployed accountants should be doing right now

From the perspective of the IRS, CPAs and EAs are on the same level. Both types of accountants can represent clients during an audit. The CPA Exam used to have a stricter timeline than the EA, with scheduling “windows” throughout the year. However, NASBA now offers all four parts of the exam year-round with continuous scheduling.

• Both big and small accounting firms will have EAs on staff, although many eventually branch off to start their own tax preparation businesses.
• So, out of an Enrolled Agent or CPA for business tax preparation, who should I choose?
• A CPA’s expertise is based on accounting and auditing, but most CPAs provide tax filing services as well.
• An EA with many years of experience could earn more than a CPA who is in their first year or two in practice.
• You must pass all four parts of the CPA Exam within a rolling 18-month period that begins as soon as you pass your first exam section.
• EAs are required to pass an examination or they must have worked at the IRS for a specified period of time.

It’s helpful to compare the differences between a CPA and an EA so you can decide which one is the best. We follow strict ethical journalism practices, which includes presenting unbiased information and citing reliable, attributed resources. At Finance Strategists, we partner with financial experts to ensure the accuracy of our financial content. For broader accounting needs, a CPA can be an advantage, especially when you need a financial statement for a bank loan. Basic accounting tasks such as reconciling bank statements and conducting periodic account reviews.