As a tax preparer, you might wonder, can I represent my client in an IRS audit? Or, do I need to be an enrolled agent (EA) to negotiate with the IRS on my client’s behalf?

The short answer is that your representation rights may be limited without having an EA designation.

EAs possess unlimited rights to represent any taxpayer before the IRS, whereas noncredentialled tax preparers face more restrictions.

Let’s explore why client representation matters and how becoming an EA expands your services.

Who can represent clients before the IRS?

Not all tax professionals have the same authority.

• PTIN holders (no AFSP or credentials): Can only prepare returns – no representation rights for returns prepared after Dec. 31, 2015.
• AFSP participants: Can represent clients only for returns they prepared and signed, and only before revenue agents, customer service reps and similar IRS employees, including the Taxpayer Advocate Service.
• CPAs and attorneys: State-licensed professionals with unlimited rights, but may not have expertise in taxation or tax disputes.
• Enrolled agents (EAs): Federally enrolled with unlimited rights to represent any taxpayer before the IRS.

Unlike CPAs and attorneys, who may not specialize in taxes, all EAs specialize in taxation. They are the only professionals required to prove competence in taxation, representation and ethics before earning unlimited IRS representation rights.

Where an EA’s expertise is needed

1. IRS audits

EAs can assist in audit and letter responses, addressing all issues the IRS has raised, regardless of whether the EA prepared the examined returns.

2. Collections and payment plans

Clients with tax debt face liens, levies or wage garnishments. EAs can negotiate installment agreements, penalty abatements and settlements.

3. Appeals and IRS disputes

If the IRS makes an unfair ruling, an EA can file an appeal and advocate for their client. While generally only attorneys argue in Tax Court, EAs can handle most pre-court negotiations.

How an EA helps taxpayers

Your client, Sarah, receives an IRS audit letter. If you’re a PTIN holder without AFSP credentials, the help you provide would be very limited.

Sarah would either be alone or need to find other assistance.

As an EA, you would be able to:

• Communicate directly with the IRS on Sarah’s behalf
• Challenge any incorrect audit findings
• Negotiate any potential penalties

Instead of facing the IRS alone, Sarah now has a pro defending her.

If you’re not an EA, you can only go so far for your clients. When the stakes are high – like audits, appeals or collections – the limitation could cost your client… and you.

Why becoming an EA is a good idea

• Defend clients in serious IRS matters
• Expand beyond tax prep into representation and resolution
• Increase your income
• Represent clients in all 50 states

EAs have advantages and privileges with the IRS that unenrolled tax preparers don’t.

With unlimited representation rights, EAs can fully advocate, negotiate and defend any client.

Want to grow your skills and your tax business?

Ready to take your tax career to the next level? We’re building a free library of guides, blogs and tools to help you become an enrolled agent. Drop your email below, and we’ll send new resources as they’re released.

It happens more often than you’d think — a college student or young adult files their tax return before their parents, checking the wrong box and claiming themselves as a dependent. When their parents later e-file, their return is rejected, claimed credits are denied, and frustration sets in. Fortunately, the IRS rolled out new tools for 2025 to help resolve these mix-ups more efficiently, saving time for tax preparers and their clients in the thick of tax season.

With filing day just a week away, there are a few things to consider if you or your client find themselves in this situation.

What happens when a dependent claims themselves on a tax return?

Many students and young adults don’t understand when they’re considered a dependent for tax purposes. Sure, they might be 18, a college freshman and “technically” not dependent on their parents. However, if they don’t meet the IRS’s requirements of being a dependent for tax purposes, or their parents have a different view of their dependency status, checking the box indicating they are NOT a dependent can create headaches for everyone

Often, the problem is the result of a dependent wanting their refund quickly and not checking in with their parents or guardian. This can cause:

1. Duplicate claims: The IRS only allows one taxpayer to claim a dependent. If a dependent files and claims themselves, the return from the primary taxpayer (usually the parent or guardian) is rejected when e-filing.

2. Delayed refunds: If a parent tries to claim tax benefits such as the child tax credit (CTC) or the earned income tax credit (EITC) after the dependent has already claimed themselves, the parent’s return is flagged and potentially delayed. If the dependent goes to college, the parent cannot claim education credits like the American opportunity tax credit (AOTC) either.

Dependent claim changes for the 2025 filing season

Starting with the 2025 filing season (2024 tax returns), the IRS is making it easier to resolve these situations by allowing the second taxpayer (usually the parent or guardian) to e-file their return – even if their dependent has already been claimed. The parents must meet a few requirements to do so.

1. Create an IP PIN: The primary taxpayer must include a valid Identity Protection Personal Identification Number (IP PIN) when filing. This helps the IRS verify the taxpayer’s identity.

2. Re-file electronically: Parents then use the IP PIN to refile their return electronically. If a dependent accidentally claimed themselves in prior years, the parent or guardian had to file a paper return amending the dependent status. This process led to extended processing times and delayed refunds.

Why do I need an IP PIN?

An IP PIN is a unique six-digit number issued by the IRS to prevent fraudulent filings and identity theft. Starting in 2025, an IP PIN will be mandatory if a dependent is accidentally claimed, allowing the second taxpayer to submit their return electronically and avoid refund delays. Taxpayers can request an IP PIN online through the IRS IP PIN tool or by completing Form 15227, Application for an Identity Protection Personal Identification Number (IP PIN). Once enrolled, the IRS issues the taxpayers a new IP PIN annually and they should include it with their return each year.

What to do if a dependent claims themselves

Here’s an example to demonstrate the process. Let’s say Lucy’s 21-year-old daughter Madison claims herself on her tax return to get a refund of withholding. Madison made $3,000 working part-time last year. Lucy provided more than 50% of her daughter’s support since Madison goes to college, works part-time and lives at home. Madison got her refund, but when Lucy tried to file her return claiming Madison as a dependent, the return was rejected.

Here are the steps a tax pro will take to rectify the situation.

1. Confirm the error: Review the dependent’s return to verify they mistakenly claimed themselves.

2. Amend the dependent’s return: The dependent may need to file Form 1040-X to correct the error and indicate that they are being claimed as a dependent.

3. File the parent/guardian’s return: Include an IP PIN when e-filing to prevent rejection and process the return smoothly.

4. Review credit eligibility: Claim any applicable credits, such as the CTC, EITC or AOTC, if eligible.

Navigating dependent-related filing issues can confuse taxpayers and frustrate those relying on important tax credits. If you are a tax professional, staying up to date on the IRS’s evolving e-file options – like the new IP PIN requirement – allows you to better guide clients through the process of resolving common filing errors with confidence and clarity.

NATP members are committed to providing accurate, timely advice in even the trickiest of tax situations. As the IRS modernizes filing options, having a trusted tax expert on your side makes all the difference. For more updates like this, subscribe to our blog and get notified when a new post is published!

Taxpayers and their tax professionals now have a new option for clients facing tax debt: the Simple Installment Agreement. Introduced by the IRS and effective March 5, 2025, this program replaces the old Streamlined Installment Agreement for individual taxpayers, offering more flexible payment options and better terms for those who want lower monthly payments and want to avoid a Notice of Federal Tax Lien.

What is the Simple Installment Agreement?

The Simple Installment Agreement or “Simple IA” modifies the prior Streamlined Installment Agreement terms for taxpayers who owe $50,000 or less to the IRS. The IRS provides guidance on this new payment plan option in its March 3, 2025, Office of Chief Counsel Memo SBSE-05-0325-0008.

Here are the terms of the Simple IA:

• Eligibility: Taxpayers with an assessed balance of up to $50,000. Note, the assessed balance does NOT include the accrued penalties and interest after the initial tax assessment (i.e., a filed tax return that assesses tax).
• Duration: Allows payment plans of up to 120 months, or until the IRS collection statute expiration date (“CSED”), whichever is the shorter timeframe.
• No tax lien filing: If the agreement is set up before a Notice of Federal Tax Lien is filed, taxpayers can avoid a lien entirely, even without using a direct debit payment method.
• Broad accessibility: 95% of individual taxpayers qualify, making it a comprehensive solution for most individuals.

The Simple IA is a step forward in making compliance easier for taxpayers while avoiding some of the constraints of its predecessor, the Streamlined Installment Agreement (SLIA).

A comparison: Simple IA vs. SLIA

Here’s how the new Simple IA stacks up against the now-retired SLIA for individuals:

Feature	Simple IA	SLIA
Assessed balance limit	Up to $50,000 (assessed balance)	Up to $50,000 (assessed balance)
Payment duration	Up to 120 months or CSED	Up to 72 months or CSED
Direct debit requirement	Not required to avoid a tax lien	Required for balances $25,000-$50,000
Lien avoidance	Possible without direct debit	Dependent on payment menthod if balance owed is between $25,000-$50,000

It should be noted that business SLIA agreements remain in effect, with specific rules for payroll and income tax balances. Payroll taxes owed up to $25,000 can be paid within 24 months using the In-Business Trust Fund Express Agreement, and businesses (Form 1120 and 1065 filers) can still pay up to $50,000 owed within 72 months or the CSED, whichever is earlier.

Example: how the Simple IA works

Consider this situation:

• Taxpayer profile: owes back taxes for 2022
  • Owes $51,900 in total (including penalties and interest)
    • Original assessed balance of $48,000
    • Accrued penalties and interest of $3,900
• Months to CSED: 100 months remaining
• Taxpayer status: in compliance; all back returns are filed
• Tax lien filing: no tax lien filed yet

Solution:

• Payment plan option selected: The taxpayer enters into a Simple IA by contacting the IRS or using the IRS Online Payment Agreement tool.
• Payment amount: The IRS calculates a minimum monthly payment of $590. Note that IRS algorithms are being updated to calculate the minimum payment. The IRS’s Online Payment Agreement application and an IRS representative will provide the minimum payment amount.
• Reduced penalties: The taxpayer benefits from a reduced failure-to-file penalty rate of 0.25% per month because they entered into a payment plan before they reached IRS Collection and filed their return on time.
• Select payment method: Payment methods include direct debit, online payment or check. Online setup with direct debit offers the lowest setup fee ($22).

This “simple” process helps taxpayers manage their obligations while improving payment terms.

Key takeaways for tax professionals

The IRS continues to change taxpayer collection alternatives to make it easier to resolve back tax issues. Tax professionals should consider the Simple IA a vital tool for assisting clients who owe taxes but cannot pay in full. Its longer payment terms, improved accessibility and flexibility make it a more taxpayer-friendly option than the previous SLIA.

With proper guidance, taxpayers can resolve their balances efficiently and avoid the complications of a tax lien filing.

Stay informed and help your clients navigate these changes to achieve compliance with less stress and greater convenience.