What’s the Difference Between a CPA and an EA?
Recently a financial planner was referred to me in hopes of networking. She said she needed a good CPA to refer her clients to. When I said I wasn’t a CPA but an EA, she paused and said, “but I can only refer to CPAs”. Do you know what an Enrolled Agent (EA) is?
All tax professionals are not created equal and knowing the difference can be advantageous to you and your clients. Certified Public Accounts (CPAs) are licensed in the state they practice and are not required to demonstrate their competence in all areas of taxation. Enrolled Agents are the only federally licensed tax practitioners who specialize in all areas of taxation and can represent taxpayers in front of the IRS anywhere in the country. Per the National Association of Enrolled Agents, “Enrolled agents (EAs) are America’s Tax Experts.”
- Enrolled Agents are required to have extensive knowledge and understanding of the complexity of todays tax code and how it will affect you.
- Along with stringent testing to earn the EA credential, including a rigorous background check, Enrolled Agents are required to take 72 hours of continuing education in tax and tax law every 3 years.
- Enrolled Agents are required to adhere to the provisions and ethical standards of the Department of Treasury’s Circular 230
Because the requirements are so tough, there are only 53,000 Enrolled Agents practicing in the United States (per the National Association of Enrolled Agents) compared to 664,532 CPAs (per the National Association of State Boards of Accountancy).
Before hiring any tax professional, do your research. With the proper tax professional supporting you and your business, you can feel confidant that you are in good hands!