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What is an Enrolled Agent?

October 15, 2014  |   Tax News   |   Tags: , ,  

It’s often a good idea for those facing an IRS tax debt to seek professional assistance. Many imagine this means a powerful tax attorney or a high level accountant. Not everyone with a tax issue considers using an enrolled agent; many people have never even heard of one before. An enrolled agent is often the best tax professional to work with regarding IRS problems. Many tax firms are eager to hire enrolled agents because they have been trained to deal with most of the issues that taxpayers face.

irs enrolled agentAn enrolled agent is a certified tax professional who has proven that they have the knowledge, skills, and commitment to help taxpayers resolve their problems with the IRS. In fact, some accountants and attorneys choose to bolster their own qualifications by earning this license. However, this certification is not easy to obtain.

In order to become an enrolled agent, there are generally two ways for one to obtain license: first, an individual can be someone who was previously employed by the IRS for a minimum of five years. This is an advantage for any taxpayer who would like to work with someone who has inside knowledge of IRS operations. Second, an individual can pass the Special Enrollment Exam administered by the IRS which covers a wide spectrum of tax law. The test is comprehensive, takes eight hours over a two-day period, and is separated into three areas of tax knowledge:

  1. 1. Individual Taxes
  2. 2. Business Taxes
  3. 3. Representation, Practice, and Procedures

Every portion of the exam must be passed in order for one to be considered for enrolled agent status. In addition to proving their knowledge of the IRS tax system, all applicants must pass to a rigorous background check which is also conducted by the IRS.

Once an individual has finally achieved his or her esteemed position, there is still more work to do. In order to sustain their status with the IRS, enrolled agents must complete a minimum of 72 hours of continuing education over a three-year period. If they want to stay competitive with other enrolled agents and be a member of the National Association of Enrolled Agents (NAEA), they have to do a minimum of 30 hours a year over a three-year period for a total of 90 hours of continuing education.

In much the same way you would see a cardiologist for a serious heart problem, most people would benefit greatly from working with an enrolled agent for an IRS tax issue. It’s highly recommended that taxpayers experiencing significant problems with the IRS consider working with an enrolled agent.