Introduction
Tax return season is one of the most stressful times for individuals and businesses but also one of the most critical. It may seem far more frightening than it actually is, however, it's no longer straightforward and easy.
Therefore, when it comes to tax preparation and representation, most people at some point will seek the help of an Enrolled Agent (EA). An Enrolled Agent is a trusted professional who can guide you through the taxation process and ensure compliance with all laws and regulations. This article explains what an EA is and its importance for tax purposes.
Who is an Enrolled Agent?
An Enrolled Agent (EA) is a licensed tax advisor who represents taxpayers before the Internal Revenue Service (IRS). They are authorized by the IRS to represent taxpayers and have unlimited rights to practice before the IRS, including the ability to represent clients in audits, collections, and litigation.
EA is the highest honor a tax professional can have. To earn and maintain this award, EA goes through rigorous courses and tests. EA is an elite status in the world of tax preparation and is extremely valuable to clients.
How to Qualify as an Enrolled Agent?
To qualify as an EA in the eyes of the IRS, one must complete a three-part exam called the Special Enrollment Examination (SEE Exam). This 3.5-hour exam covers all aspects of federal taxation: Individual tax, corporate tax, and representation, practice, and procedures, with 100 marks each. Therefore, even before considering taking this exam, tax accountants must complete rigorous courses and training in tax law and preparation.
There are many institutions in India that offer EA courses for those who aspire to a career as an Enrolled Agent. For example, Henry Harvin's “Enrolled Agent Course” online offers a comprehensive SEE (Special Enrollment Examination) preparation module for admission as a tax advisor.
The Importance of Enrollment Agent
EA's role in tax preparation and representation is crucial and is highlighted in the following 15 points.
- EA can help you prepare and file your taxes. This is because they have deep and proven tax knowledge and skills to verify your financial information, identify deductions/credits and ensure your tax return is accurate and complete.
- Not only will they review and file your tax returns, but they will also provide advice on how to minimize your tax liability and take advantage of available deductions. This means EAs are useful for future tax planning.
- EA is the only tax professional with unlimited representation rights. This means they can represent our clients in all tax matters before the IRS.
- Continuing the above point, owing to their very versatile and functional skills allow them to represent clients on any matter including audits, payment/collection matters, and appeals.
- Also, EAs are up to date with the latest information in taxation and comply with ever-changing tax laws and regulations. Thus, the tax code system can be deciphered and made more understandable for taxpayers.
- EA protects you against unfair advantages taken by the IRS, state tax departments, financial institutions, and other authorities.
- Representation in all states – EA is not bound by geographic location.
- EA's unique tax expertise allows them to offer clients better pricing than other tax professionals.
- EA is important for providing tax advice in compliance with IRS rules and regulations.
- They also educate clients on how tax laws and regulations affect their businesses.
Conclusion
An Enrolled Agent is a qualified professional and a one-stop shop for your tax matters, including planning for the future and filing tax returns. The right EA will work closely with you to make sure everything is done right from start to finish. Needless to say, when tax return season arrives, that peace of mind is priceless.
