Raise your hand if you love the IRS. Hand not raised? It’s not surprising that many people loath and fear the IRS. Tax laws are so complicated and preparing income tax returns, paying taxes, and understanding everything involved can be very confusing. Being audited by the IRS is an individual or companies biggest fear when it comes to taxes. No one wants to have to give back money or pay additional penalties, or worse yet, go to jail.
When an individual needs representation against the IRS in cases of audits or appeals, they might turn to an enrolled agent for assistance.
Enrolled agents are individuals who are considered tax professionals and have been authorized by the US Department of Treasury to represent tax payers in audits and appeals by the IRS. Enrolled agents are licensed to practice in areas of tax and finance, and are authorized to serve the public in tax matters. They are unrestricted in which clients they can represent or what types of cases they want to handle.
Becoming an Enrolled Agent
It’s fairly easy to become an enrolled agent, although the preparation can be daunting.
An individual must take an exam regarding tax codes or have worked at the IRS for five years in the area of tax regulations. Individuals who become enrolled agents are subject to a background check and must comply with IRS ethical standards. Enrolled agents can be either self employed or work for a tax or accounting firm.
There are preparation classes online that individuals can take and practice tests available before one takes the official test. Colleges and large tax firms also offer classes that teach tax law to individuals looking to become enrolled agents.
Enrolled agents are expected to keep abreast of all current tax laws, therefor are required to take additional courses from time to time.
Finding an Enrolled Agent
If you need the assistance of an enrolled agent, you can search the National Association of Enrolled Agents which has over 11,000 members. You can also use online directories or the phone book and search under tax preparation.
Choose an enrolled agent who is local to you and well qualified. You can determine this by asking for references and current credentials. While an enrolled agent doesn’t have to join the National Association of Enrolled Agents, it is useful and beneficial to start looking for one who has.