Anyone who has even gotten an official notification from the Internal Revenue Service knows the feeling of dread and unease it causes. Even those who have filed taxes on time and sent any money owed along with it, may be momentarily concerned they have made a costly mistake. Individuals with simple returns they handle themselves, or others with slightly more complicated financial situations who turn to commercial agencies for return preparation, probably do not require the services of a professional who has taken and passed the enrolled tax agent exam.
It is more common for corporations, partnerships, trusts, estates, and individuals with valuable assets to employ these professionals. They not only use them to prepare their taxes, but rely on the agents to present them in front of the IRS if the occasion arises. In fact these are the only individuals, with the exception of accountants and lawyers, who are permitted to negotiate on their client's behalf with government agents. They are even more qualified than most lawyers and CPAs, because taxes are their entire focus.
Agents who specialize in taxes make significantly more money, and often have more benefits, that those without the designation. Individuals interested in working toward such a designation need to know how long it takes and what it involves. Anyone who prepares taxes professionally must have a preparer identification number. To receive an enrollment designation, applicants must take and pass a three part examination. Once they have successfully completed the test, the IRS will check to make sure they do not have any unpaid taxes or returns outstanding.
The first section of the enrollment test focuses on individuals. The questions include general client information, verification of all income sources, itemization of assets, credits, and itemized deductions. Individuals also answer multiple questions concerning advising clients on personal financial matters.
The second section focuses on businesses. Applicants must understand the various types of partnerships and corporations and be able to explain how they differ from one another. They must have thorough knowledge of financial statements and the record keeping required to substantiate them. There is a section on the special regulations that govern farming operations.
Procedures and practices are the third leg of all examinations. They have to be able to handle any situation that arises when they are in the middle of representing a client. Applicants must have a clear understanding of any penalties, repercussions, and fines that go along with any misrepresentation of facts in a case.
Anyone who passes a portion of the test can retake the other parts. They have two years to satisfactorily complete the whole examination. Testing lasts about four hours per section, and books are not permitted. All agents are bound by a code of professional conduct and ethics and the provisions of the Treasury Department.
Individuals and businesses with multiple assets may have complicated taxation structures. They often turn to specialized agents. They feel confident they are getting the most competent and informed representation possible.
It is more common for corporations, partnerships, trusts, estates, and individuals with valuable assets to employ these professionals. They not only use them to prepare their taxes, but rely on the agents to present them in front of the IRS if the occasion arises. In fact these are the only individuals, with the exception of accountants and lawyers, who are permitted to negotiate on their client's behalf with government agents. They are even more qualified than most lawyers and CPAs, because taxes are their entire focus.
Agents who specialize in taxes make significantly more money, and often have more benefits, that those without the designation. Individuals interested in working toward such a designation need to know how long it takes and what it involves. Anyone who prepares taxes professionally must have a preparer identification number. To receive an enrollment designation, applicants must take and pass a three part examination. Once they have successfully completed the test, the IRS will check to make sure they do not have any unpaid taxes or returns outstanding.
The first section of the enrollment test focuses on individuals. The questions include general client information, verification of all income sources, itemization of assets, credits, and itemized deductions. Individuals also answer multiple questions concerning advising clients on personal financial matters.
The second section focuses on businesses. Applicants must understand the various types of partnerships and corporations and be able to explain how they differ from one another. They must have thorough knowledge of financial statements and the record keeping required to substantiate them. There is a section on the special regulations that govern farming operations.
Procedures and practices are the third leg of all examinations. They have to be able to handle any situation that arises when they are in the middle of representing a client. Applicants must have a clear understanding of any penalties, repercussions, and fines that go along with any misrepresentation of facts in a case.
Anyone who passes a portion of the test can retake the other parts. They have two years to satisfactorily complete the whole examination. Testing lasts about four hours per section, and books are not permitted. All agents are bound by a code of professional conduct and ethics and the provisions of the Treasury Department.
Individuals and businesses with multiple assets may have complicated taxation structures. They often turn to specialized agents. They feel confident they are getting the most competent and informed representation possible.
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