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Certified Public Accountant (CPA) or Tax Professional or Enrolled Agent: Uncover the Distinction


When it comes to handling finances, both individuals and companies often turn to experts to help them deal with the complexities in the world of taxes.

Understanding the differences between Certified Public Accountant (CPAs), Tax professionals, and Enrolled Agents (EAs) is crucial for making informed decisions about tax planning and compliance. 

CPAs are licensed accounting professionals, while tax professionals specialize in tax preparation and planning. On the other hand, EAs are federally authorized tax practitioners with the highest credentials awarded by the IRS.

 In this blog, we will compare and contrast these three types of professionals to help you determine which one best suits your needs.

What is a CPA (Certified Public Accountant)?

A professional who has completed the necessary training, qualification, and licensing criteria to utilize the CPA designation is known as a Certified Public Accountant (CPA). They differ from unlicensed accountants because they have licenses from professional accounting organizations and must maintain continuing education.

CPAs must hold a bachelor’s degree in accounting or a related field, pass the Uniform CPA Examination, and complete work experience requirements, which are typically one to three years long. CPAs can provide a wide range of services, including tax preparation, auditing, financial planning, and consulting for individuals, businesses, and government entities. They are highly qualified to perform these tasks due to their advanced credentials and professional code of conduct.

What is an Enrolled Agent (EA)? 

Enrolled agents are another type of tax professional authorized by the US government to defend taxpayers before the IRS. These employees may represent taxpayers if they pass the (SEE) Special Enrollment Examination or come from previous IRS employment. They are the only federally certified tax experts who can engage in tax representation against the Internal Revenue Service (IRS) on behalf of their clients without restrictions.

An EA can help individuals, partnerships, corporations, estates, trustees, and any other entity that pays taxes file income tax returns. As experts in a dynamic area such as taxation, they can represent taxpayers during IRS audits effectively. 

Unlike lawyers and CPAs, all EAs are tax experts. Enrolled agents must adhere to the regulations stipulated in the IRS’s Circular 230, which outlines the professional ethics of practitioners before the IRS. The specialized knowledge and experience they provide are vital for proper tax planning, preparation, and representation during litigation.

What is a Tax Professional? 

A tax professional is an individual with experience, knowledge, and credentials who can assist with tax preparation. There are many professionals within this category, including CPAs, Enrolled Agents (EAs), tax attorneys, and other tax preparers. 

Not all tax professionals are CPAs or EAs, and some may not have any formal credentials. Tax professionals are keen to monitor the tax laws, rules, and regulations that may change from one year to another and affect tax obligations. The IRS may license them to handle tax and payment cases on behalf of clients. On the other hand, CPAs and Enrolled Agents possess their respective licenses and credentials; however, other tax preparers may have varying degrees of educational background and experience.

A tax professional can be classified into four categories: a Certified Accountant (CPA), an Enrolled Agent (EA), a tax attorney, or a non-credentialed taxpayer. CPAs are licensed accounting professionals with specific educational and certification requirements. EAs are federally authorized tax practitioners with extensive tax preparation experience. Tax attorneys specialize in tax law and provide legal advice. Non-credentialed tax preparers may need formal credentials but can still provide quality tax preparation services. The right tax professional should meet your specific needs and have the expertise to address your tax concerns.

What are the differences and overlaps between each of them? 

Certified Public Accountants (CPAs), tax professionals, and Enrolled Agents (EAs) are all crucial in the field of taxation, each with distinct roles and responsibilities. CPAs are state-licensed accounting professionals who can specialize in various areas, including tax consultation, auditing, and financial planning. 

The EAs, on the other hand, are federally authorized tax practitioners who specialize specifically in taxation and have the privilege of representing taxpayers before the IRS. As a broader category, tax consultation includes CPAs, EAs, tax attorneys, and non-credentialed tax preparers, whose expertise and credentials vary.

 While CPAs and EAs can both provide tax preparation and planning advice, EAs specialize exclusively in taxation and have unlimited rights to represent taxpayers before the IRS. Tax attorneys, on the other hand, specialize in tax law and can provide legal advice on tax matters. Non-credentialed tax preparers may also offer tax preparation services but may not have formal credentials or specialized expertise. 

Therefore, the choice of professional depends on the specific tax needs, with EAs being the go-to for specialized taxation matters and representation before the IRS, while CPAs and tax attorneys may be preferred for broader financial and legal advice, respectively.

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Which is the Right Professional for You? 

When determining which type of tax professional is right for your needs, several factors should be considered. First, assess the complexity of your tax situation. In uncomplicated cases, a non-credentialed tax preparer may be sufficient, but in more complex situations, you may need a member of the CPA or Enrolled Agent profession (EA). 

Second, consider the specific services you require. CPAs often provide a wide range of financial and accounting services, while EAs specialize exclusively in taxation and have unlimited rights to represent taxpayers before the IRS.

Finally, evaluate your budget. CPAs and tax attorneys typically charge higher fees due to their advanced expertise, while EAs and non-credentialed tax preparers may offer more affordable options. It’s essential to research and interview potential tax professionals to ensure they have the necessary credentials, experience, and expertise to meet your specific needs. 

By carefully considering these factors, also outlined by the American Bar Association, you can select the right tax professional to provide the guidance needed for your individual or business tax matters.

In conclusion, the world of tax professionals are diverse, with each type offering unique expertise and services.

Certified Public Accountants (CPAs) are licensed CPA or accounting consultants who can provide a wide range of financial and accounting services at their accounting firm, including tax consultation, auditing, and financial planning. Enrolled Agents (EAs) are federally authorized tax practitioners who specialize exclusively in taxation and have unlimited rights to represent taxpayers before the IRS. Tax attorneys specialize in tax law and can provide legal advice on tax matters, including tax planning to minimize tax liability. Non-credentialed tax preparers may also offer tax preparation services but may not have formal credentials or specialized expertise. 

When choosing a tax professional, individuals and businesses should consider the complexity of their tax situation, the specific services they require, and their budget. The best way to find a tax professional who meets your specific needs is to research and interview them. Seeking professional advice can provide the guidance and assistance needed for individual or business tax matters, ensuring compliance with tax laws and maximizing tax benefits.

At BFG Business Financial Group, we take pride in helping businesses and firms with their financial planning needs. Our CPA office is near you at Peachtree, Norcross, GA. Our team of experienced Enrolled Agents (EAs), tax professionals, and Certified Public Accountants CPA work together to provide timely and absolute tax solutions for our clients. We understand that each business is unique, and our tailored services aim to address your specific financial concerns. Whether you’re a small business owner or a corporate executive, BFG is committed to helping you make informed financial decisions that contribute to your long-term success.

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