Is it worth it to become an enrolled agent?

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Michelle Hammond

After passing the RTRP test, I'm debating taking the enrolled agent test. 

Is it worth it?  What are the benefits?  How hard is the exam?

With Christmas quickly approaching & tax season around the corner, I wouldn't start until after 4/15/13! :)

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2 Answer(s)

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Conrado Mangapit EA

You should look at the tax return preparation industry as a whole.  Today, the normal in the industry is the PTIN holder (that is, you can prepare tax returns without the RTRP designation for compensation as long as you have a PTIN . . . . you have until 12/31/2013 to get your RTRP.  So for this upcoming tax season PTIN holders and RTRPs will coexist on an equal basis). However, beginning 1/1/2014 the new normal within this industry will be the RTRP . . . . if you don't have it then you cannot legally prepare tax returns for compensation (there are exceptions for supervised preparers and non-1040 preparers).

If you become an Enrolled Agent then, according to the IRS, you achieve "elite" status among tax practitioners and you'll be able to do things "beyond" tax preparation (Such as legally offer tax advice and provide representation services for both individual and business entities, trusts, and estates throughout the  United States (and its territories) and at all levels of the IRS appeals process

I've done tax returns for the past 5 seasons as a PTIN holder for a well known tax preparation chain.  After I  received my EA credentials . . .. well, things just changed for the better. . . .

Vote for this anser to Is it worth it to become an enrolled agent?
Jasmine-Gabrielle Green

This depends on what you want to accomplish in your career. According to Section 10.3(f)(3) of Circular 230 provides that a registered tax return preparer’s authorization to practice “does not include the authority to provide tax advice to a client or another person except as necessary to prepare a tax return, claim for refund, or other document intended to be submitted to the Internal Revenue Service.”  The IRS interprets this provision to permit registered tax return preparers to provide advice to a client that is reasonably necessary to prepare a tax return, claim for refund, or other document intended to be submitted to the Internal Revenue Service for a current or future tax period, regardless of whether the client has engaged the registered tax return preparer to prepare the tax return, claim for refund or other document for the tax period.

I made this statement bold and underlined it because I have a feeling with the push toward December 31, 2013 many are going to be taking the RTRP exam without fully understanding that as an RTRP, your services are limited. Please don't get me wrong, this is not meant to be disrespectful to anyone that has or will take the RTRP exam. What I am trying to say is that you have to look at your career goals when it comes to the field of tax accounting. Know the difference between and RTRP and an EA. If you like to have unlimited practice before the IRS, then you will need to take the SEE. If you can accomplish your goals as an RTRP and have no need to be an EA, then take the RTRP exam.  Thus the benefits depends upon how you want to deal with your clients and your vision of where you see yourself 5 years from now. 

Now, as far as is the test hard. Yes and No. This depends on your experience. I did not find part 1 of the exam difficult at all. I was able to pass on my first try using FFA without having to take pratice exams. Now for part 2, I have no experience in business taxation and never worked doing corporate tax accounting. I was not sucessful on my first attempt to pass part 2. However, I learned where my weakness is and I have been focusing on those area's to retest for part 2. I find part 2 the most difficult to pass and learn just because the math forumula are much more invovled than in part 1. Sometimes, I'll come across a problem and be completely confused as to how I'm supposed to answer the question. This has always been my weakness when it comes to math. Someone good with word problems might not have the same issues as me. Thus, the difficulty of the exam depends upon who answers the questions, their weakness and their experience on the subject matter.

Personally, I'll have no issue with part 3 because the math problems are much much less and  its mostly law. I love studying law and tax accounting. I actually was enrolled in law school but did not finish due to personal reasons so instead I obtain my Master degree in Accounting which I wish I had obtained my degree in Taxation instead of accounting. If I could go back in my life and changes things, I would become an tax attorney. This passion for law and taxation is what drives me to become and enrolled agent and someday become a United State Tax Court Practitioner.

Lastly, once I reach this level, it will make up for what I didn't do in my past but can do in my present. So for me, become an enrolled agent is the most beneficial in terms of what I want to accomplish in my life and my career in taxation at a level that I would like to be most helpful to my clients. 

Jasmine-Gabrielle, Thank you SO much for taking the time to write your thoughts. Everything you wrote was very helpful especially when you talk about career goals. Good luck during your testing process! I wish you the best!
Posted by Michelle on 12/16/2012 @ 5:14 PM
Thanks Michelle
Posted by Jasmine-Gabrielle on 12/16/2012 @ 5:56 PM

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To the extent any advice relating to a Federal tax issue is contained in this communication, including in any attachments, it was not written or intended to be used, and cannot be used, for the purpose of (a) avoiding any tax related penalties that may be imposed on you or any other person under the Internal Revenue Code, or (b) promoting, marketing or recommending to another person any transaction or matter addressed in this communication.

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