How To Be Ready For The Enrolled Agent Exam

By Eula Clarke


The Internal Revenue Service or IRS is a bureau of the Department of the Treasury and is being directed by the Commissioner of Internal Revenue. This agency collects the taxes and processes tax returns annually. They also administer the Internal Revenue Code.

Civilians have advocates called enrolled agents to deal with situations where claims against the government need to be created. They have to take the enrolled agent exam to become tax practitioners and be given the authority by the Department of the Treasury to represent taxpayers before the IRS. Attorneys and certified public accountants are also given the power to advocate for the them, but are licensed on a state by state basis.

The Federal statute standardizes these practices before the IRS. The moment that the applicants achieve the passing score and be legitimately authorized to represent clients, they will be recognized as Federally Authorized Tax Practitioners or FATPs. Attorneys, CPAs, and enrolled agents can be granted this status.

All these practitioners represent their clients on cases involving audits, collection actions, payment concerns, refund issues, and appeals. Should they be willing to undertake such enormous challenges, these candidates must obtain a PTIN, or the Preparer Tax Identification Number. This allows them to legally prepare federal tax returns or claims for refund.

The applicants must pass all of the three portions of the Special Enrollment Examination or SEE. This exam covers most of the tax codes. Their other option is to work for the IRS for five continuous years, focusing more on areas where they can apply and interpret the Internal Revenue Code and the laws on income, estate, gift, exercise taxes, or employment. However, if they do not pass the test, each of the parts can be retaken four times in any testing year provided to interested applicants.

Once the applicant successfully pass the test, within one year they must submit Form 23. After this, a background check will begin. This investigation will include the personal credentials of the applicant and the business compliance in relation to tax payments.

Enrolled agents can renew after the initial enrollment cycle which is the three consecutive enrollment years before the effective date of renewal. They must complete 72 hours every three years of continuing professional education based on their renewal cycle. A minimum of 16 hours per year is also a requirement, two of which must be based on ethics.

Agents can renew every three years based on the last digit of SSN. Simply view Circular 230 Section 10.6d for the specific cycle. They can renew online at Pay.gov, just put 8554 in the search box, or renew on paper using Form 8554.

However, should the applicants fail to submit the renewal application on time, they will be added to the roster of inactive enrolled agents. If they also do not respond immediately to a noncompliance notice or submit all the requirements for renewal then they will be added to the inactive list too. They will not be legally authorized to advocate for clients, be called an enrolled agent, or utilize the EA status.




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