EA 101 Becoming an Enrolled Agent

Begin at the Beginning What is an enrolled agent?  An EA is a tax professional who has earned the right to practice before IRS  An EA is a taxpayer representative stands in and speaks for taxpayers taxpayers have right to representation

So, EAs Practice Before IRS... What is practice?  Communicating with IRS on behalf of a taxpayer regarding rights, privileges, or liabilities  Representing a taxpayer at hearings, conferences, or meetings with IRS  Preparing & filing necessary tax documents for a taxpayer

What about the Changing Preparer Environment?  NAEA advocates for reasonable, meaningful regulation  Years of inside-the-beltway wrangling  Commissioner Shulman released Return Preparer Review in December 2009

Return Preparer Review Affects all paid tax preparers, minimal for EAs, CPAs, and tax attorneys Requires  Preparer Tax Identification Number (PTIN) Form W-7P  Competency testing (2 tests being planned, with at least another anticipated)  15 hours of CPE annually cont’d

Return Preparer Review cont’d  Extends Circular 230 ethics standard to all preparers  Establishes IRS right to conduct tax compliance checks on all tax return preparers

So, What Happens Next? Return Preparer Regulation provides transition period  PTINs before next filing season  CPE requirement starts in 2011  Everyone must pass test by end of 2013

Why Become an EA? EAs, like other current Circular 230 practitioners (attorneys, certified public accountants):  need not pass any of the new tests  may prepare all returns  are granted unlimited practice rights

Why Become an EA?  Demonstrate highest competency  Serve clients better, more completely  Build practice

How Do I Become an Enrolled Agent?  Register and schedule your appointment to take the SEE  Pass all three parts of the SEE  Apply for admission to practice by submitting Form 23

Nuts and Bolts of the SEE Three parts  Part 1 -- Individual  Part 2 -- Business  Part 3 -- Representation, Practice and Procedures

Nuts and Bolts cont’d  Tests are revised annually, based on prior year tax law  Testing period is May 1 - February 28  Tests may be taken in any order & test results are immediately available  After passing the a part of the exam, you have two years to pass the other two parts  Fee per exam is $101

Registering for the SEE  Prometric website (  Select testing center and date/time 279 US and 139 international testing sites On average, exams can be scheduled within a two-week timeframe  Proper documentation needed at test site, including biometric fingerprint, photo and government issued ID

What Kind of Questions are on the SEE? All questions are multiple-choice, including:  Direct question  Incomplete sentence  All of the following except …

Once you’ve completed the exam … A score of 105 is required to pass. You will immediately know your results:  Pass – no score is given. Celebrate!  Fail -- Prometric will provide your score and the areas where you missed questions so you can prepare to re-take.

How many people are taking the SEE? In 2009:  17,561 registered, 14,192 took at least one part In 2010 thus far:  8,239 registered, 4,316 have taken at least one part

How many are passing? For 2009:  Part 1 – 70%  Part 2 – 68%  Part 3 – 80% Almost twice as many people took part 1 than any other part

What if I fail?  Candidates may take each part up to four times per testing period (May through February).  Candidates can re-schedule to take the test within a few days

I’ve passed all three parts-what now? Apply for enrollment on Form 23  Application fee is $125  IRS performs background check, including tax compliance  Takes between days to process

Maintaining Your License  Renew every three years, based on last digit of SSN 4, 5 and 6 – , 8 and 9 – , 1, 2 and 3 – 2013  Earn 72 hours of CPE over the three year period, with a minimum of 16 hours per year and at least 2 hours of Ethics each year. CPE is prorated for new EAs.  Enrolled agents must keep proper documentation of CPE

Preparing for the SEE  Consider your personal situation – new to taxes, or experienced? Knowledge of individual and corporate taxes?  Personal comfort and confidence in test-taking  Support system of family, colleagues and enrolled agents  Review versus Prep courses

NAEA Online Classes Online Facilitator Led SEE Prep Classes  Five sessions in 2010 with start dates of May 10, July 6, August 30, October 12 and November 31  Parts 1 and 2 are 8 week classes, part 3 is 6 weeks  Facilitators are experienced EAs – learn from the best!  Scholarships available

NAEA In-Person Class Part of NAEA’s National Conference in Las Vegas  August 8-10, 2010; August 7-9, 2011  3 days, 3 parts  Intended for experienced preparers

Can I join NAEA before I earn my EA? Yes! Become an Associate and receive:  Discounts on SEE prep materials and other products and services  Information! Newsletters, magazines, our web board and the Tax Research Service  The support and encouragement of experienced enrolled agents

Resources  “ Becoming an Enrolled Agent” section of the NAEA website (  Prometric website (  IRS website ( Please contact NAEA at if we can help you become an enrolled agent!

Special Thanks