Enrolled Agent?

There are between 900,000 to 1.4 million tax preparers in the United States, according to the IRS. They range from those who work for the big 4 accounting firms to smaller firms, from the national chains to the self-employed accountants, to even those who 'operate' from their kitchen tables.

Starting 2011 and beyond, the IRS will be regulating the profession by requiring anyone who charges a fee to prepare taxes to take a minimum number of educational hours and to pay an annual registration fee. The goal is to ensure that taxpayers can rely on qualified tax preparers and to sanction those who engage in fraudulent or reckless preparation. This would be no different than when you go to a hairdresser or dentist, knowing that the professional possesses proficiency and knowledge by meeting a certain standard.

But there already exists a category of tax preparers who have met a higher standard within the profession, having passed an IRS exam in order to be authorized by the IRS to represent clients. By becoming an enrolled agent, these professionals have demonstrated advanced knowledge not only in tax law, but ethics and representation practices as well. Only enrolled agents, along with certified public accountants and attorneys, are licensed to represent taxpayers before the IRS, such as for audits, appeals and collections. So while there might be confusing terminology, paid tax preparers are now called registered tax return preparers, but only enrolled agents are federally licensed, having met a higher standard.

To learn what an EA can do for you, click here.

What's the answer to the question?

Out of the 1.4 million tax preparers, there are 46,000 enrolled agents...about 3 percent.

   So when you choose your next tax preparer, have an EA!

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