Benefits of becoming an Enrolled Agent
The Enrolled Agent status offers benefits to the agent as well as the consumer.

The Enrolled Agent status prepares the EA to advise, represent, and prepare tax returns for a variety of clients. The status identifies these individuals to the consumer as specialists and insures the consumer that the EA has kept up to date on the latest tax law changes. This brings more business and thus more income to the practitioner.

Since an Enrolled Agent is allowed to represent taxpayers before the Internal Revenue Service, doing so opens the field of representation to the tax practitioner. The right to represent taxpayers before the IRS is given only to selected groups of individuals. Attorneys, Certified Public Accountants, Enrolled Actuaries, and Enrolled Agents are the only groups recognized to practice before the IRS. Out of that group, the Enrolled Agent is the only individual who is required to take the test to achieve the status. The others are granted the right of representation through their state credentials.

An unenrolled individual who prepares a return can represent the client for whom the return has been prepared, but only before the examination division. An unenrolled preparer cannot represent the client before the collections division. This limits what the preparer can do for the client and does not allow the preparer to perform the same function for potential clients.

The Enrolled Agent designation is a recognized symbol of expertise in the area of taxation. Practitioners who have this designation generally receive greater compensation for their services in exchange for greater expertise.

How to become an Enrolled Agent
The Enrolled Agent status is generally available to individuals who pass a four-part test and apply to the IRS to be accepted or to individuals who satisfy a five-year term of IRS employment.

The test is given once each year, usually in October. The examination is given in selected locations throughout the United States and foreign countries on the same two days. The examination consists of four separate areas. Part one covers individual tax issues. Part two addresses sole proprietors and partnerships. Part three tests corporations, fiduciaries, estates, gift tax and trusts. Part four includes ethics, recordkeeping procedures, appeal procedures, exempt organizations, retirement plans, practitioner penalty provisions, research material, and collection procedures. In 1999 a score of 60 percent or more on all four parts was needed to successfully pass the exam.

To take the test, an individual must submit an application using Form 2587. The application must be submitted to the IRS by July 31, along with a nonrefundable application fee.

Once the test is successfully completed, the preparer must apply to the IRS for acceptance.

Retaining the status of Enrolled Agent
Once a preparer has attained the Enrolled Agent status, the learning continues. A total of 72 hours of continuing education credit (CPE) is required over the three-year enrollment cycle, with not less than 16 CPE credits in one year.