Why The Enrolled Tax Agent Exam Is Important To You
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.
Such specialized agents are usually employed by managers of trusts, estates, partnerships, corporations, and individuals with multiple assets and business interests. They often handle all the filings and associated paperwork required by the IRS. If it becomes necessary, these agents will represent their clients before government officials. They are allowed to do so because of their special designation. Many clients prefer them over lawyers and accountants, because these professionals do not do anything but taxes.
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 of the three part test concerns individuals. Agents must answer multiple questions regarding gathering personal information necessary for returns, itemizing assets, deductions, and credits. They must be able to review and assist individuals with financial matters.
The second portion concerns businesses. Agents must have a thorough understanding of the different types of businesses entities, such as partnerships and S corporations, and how they work. They must be able to analyze financial records and advise those with 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.
Applicants who do not pass all three parts can carry over the parts they did pass for up to two years. The tests are closed book, and each section takes about four hours to complete. Approved agents must take continuing education courses to maintain their credentials. They also have to adhere to a code of ethics and professional conduct and are bound by the Department of Treasury provisions.
These special agents can save businesses and individuals thousands of dollars every year. They have specialized experience and expertise. They are certainly worth the fees they charge.
Such specialized agents are usually employed by managers of trusts, estates, partnerships, corporations, and individuals with multiple assets and business interests. They often handle all the filings and associated paperwork required by the IRS. If it becomes necessary, these agents will represent their clients before government officials. They are allowed to do so because of their special designation. Many clients prefer them over lawyers and accountants, because these professionals do not do anything but taxes.
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 of the three part test concerns individuals. Agents must answer multiple questions regarding gathering personal information necessary for returns, itemizing assets, deductions, and credits. They must be able to review and assist individuals with financial matters.
The second portion concerns businesses. Agents must have a thorough understanding of the different types of businesses entities, such as partnerships and S corporations, and how they work. They must be able to analyze financial records and advise those with 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.
Applicants who do not pass all three parts can carry over the parts they did pass for up to two years. The tests are closed book, and each section takes about four hours to complete. Approved agents must take continuing education courses to maintain their credentials. They also have to adhere to a code of ethics and professional conduct and are bound by the Department of Treasury provisions.
These special agents can save businesses and individuals thousands of dollars every year. They have specialized experience and expertise. They are certainly worth the fees they charge.
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