Having the right credentials is more important than ever. The enrolled agent (EA) designation is the gold standard for tax professionals who want to confidently represent clients before the Internal Revenue Service (IRS) and enhance their careers by expanding their business services.
IRS enforcement trends: audits, liens and levies
The Inflation Reduction Act provided the IRS with funds to enhance its enforcement tools, using data analytics and artificial intelligence to identify discrepancies and potential fraud. These developments mean that more taxpayers, both individuals and businesses, could face audits, collection actions or legal proceedings, ultimately leading to a need for skilled representation. The IRS has increased their audits and examinations using a variety of methods, some are done automatically. For those that require representation, clients need the right advocate.
So, if a potential client gets a notice, will you be ready to help — or have to refer them elsewhere?
The changing IRS landscape: why representation skills matter
Unlike routine tax preparation, representation requires an in-depth knowledge of IRS procedures and the ability to communicate effectively with IRS agents. EAs can navigate these challenges and advocate on their client’s behalf by:
- Understanding the nuances of tax law
- Responding to IRS notice
- Negotiating settlements
- Defending taxpayers in audits or appeals
- Challenge incorrect assessments
- Review and correct missed deductions
Why the EA credential matters
One of the most significant advantages of becoming an enrolled agent is representing taxpayers before the IRS. If your client receives an IRS notice, you can explain what the notice means and craft a response for them within the required time constraints. If an audit is required, enrolled agents can assist their clients review, prepare and gather documents. Unlike uncredentialed tax preparers, who can only assist with tax returns, EAs have unlimited representation rights without restriction and can represent their clients in any state
Prospective EAs must pass a rigorous three-part exam covering individual and business tax law, representation and ethics before the IRS awards the designation. Unlike CPAs and attorneys who are licensed at the state level and may not always specialize in taxation, EAs focus exclusively on federal tax matters.
The bottom line
As the IRS continues to audit individuals and businesses, tax professionals must be prepared to offer more than just tax preparation services. Earning an EA designation can give tax professionals an additional edge in serving their clients. Level up today by learning how to become an EA with a NATP membership.
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About National Association of Tax ProfessionalsThe National Association of Tax Professionals (NATP) is the largest association dedicated to equipping tax professionals with the resources, connections and education they need to provide the highest level of service to their clients. NATP is comprised of over 23,000 leading tax professionals who believe in a superior standard of ethics and exemplify professional excellence. Members rely on NATP to deliver professional connections, content expertise and advocacy that provides them with the support they need to best serve their clients. The organization welcomes all tax professionals in their quest to continually meet the needs of the public, no matter where they are in their careers.
The NATP headquarters is located in Appleton, WI. To learn more, visit www.natptax.com.
Information included in this article is accurate as of the publish date. This post is not reflective of tax law changes or IRS guidance that may have occurred after the date of publishing.