Considering a Career as an Enrolled Agent? Read this First

A career as an Enrolled Agent”or EA”can be a meaningful and rewarding career.  For those that are good with numbers, have an interest in law, and have excellent communication skills, work as an EA makes perfect sense.  If this sounds like you, then it's time to seriously consider embarking on a career as an enrolled agent.  Before you jump in, it's a good idea to learn about what an EA's job is like and the right steps to take to get there. Here are the essentials you need to know before becoming an enrolled agent.

Know What It Means to be an EA

The job of an Enrolled Agent is expansive.  An EA is someone who is licensed by the federal government to represent a taxpayer before the IRS.  This is one of the few jobs that allows unlimited rights on behalf of the taxpayer (the others being attorneys and certified public accountants).  As an EA, you have many job opportunities; you can work with individuals to prepare tax returns using a variety of free tax tools, specialize in one industry, prepare corporate tax returns with corporations, or construct estates and trusts.  There are a plethora of opportunities for you, and what’s more, you do not need a bachelor’s degree!  Although it is useful to have a background in finance, accounting, law, or mathematics, it is not a requirement.  All that really matters is that you pass the EA exam.

Perform a Cost- Benefit Analysis

Depending on where you live and where you work, the salary can vary widely.  That is why it is important to plan out what will work best for you.  The starting salary can be as low as around $30,000, which can be too low for some.  If you are a high salary-earning accountant already, this may not appeal to you unless you're seeking a change of pace.  However, if you stick with it, it is possible to make upwards of $75,000 over time.  You also have the opportunity for commission.  Therefore, depending on your skill, your location, and your employer, you have the opportunity to grow.

Know How to Get There

In order to go through enrolled agent training, you must follow several steps.  First, you must obtain a Preparer Tax Identification Number.  Next, you have to pass the Special Enrollment Examination, also known as the SEE.  After you pass the SEE, you can apply for enrollment.  Finally, you must undergo a tax compliance check.  The reason you must go through a tax compliance check is to be sure that you are in good standing with the IRS and have no outstanding tax issues.

Take the SEE

Before you take the SEE, there are a few things to keep in mind.  When you book the appointment, there is a non-refundable fee of $109.  You may reschedule the appointment, which may have special stipulations.  Refer to the IRS website for more information on rescheduling your appointment.  Now, here is the alternative:  certain IRS employees, and those that have worked for the IRS for at least five years, are eligible to forego the SEE to become an enrolled agent.  This is because they presumably have the experience and vast knowledge of tax law necessary to become an EA.  If you are looking to get around the SEE, then this is your best bet.

Study

For most of you who do not already work for the IRS, you will more than likely need to take the SEE.  There are three sections to the exam: Individuals, Businesses and Representation, and Practices and Procedures.  These sections cover all areas of tax law, ethical standards, tax advice, and more.  Since becoming a private exam, the scoring of the exam is not straight-forward. Having a certain score in mind may not be of use for you.  Gather all of the information that could be useful to you, including old exam questions that are publically available, or mock exams.  Once you pass the SEE, your hard work will have paid off and you will be able to practice as an enrolled agent.