EA vs CPA: Which One is the Right Path for You?

You can then select a time and place to sit for one or more exam sections. If you register using Form 2587, you will receive scheduling instructions by telephone or mail. Prometric calculates your SEE results based on how many multiple-choice questions you answered correctly in each exam section. A mathematical formula turns the number of questions you answered correctly into a scaled score ranging from 40 (no correct answers) to 130 (100 correct answers). “Enrolled” means to be licensed to operate by the federal government. “Agent” means authorized to appear in place of the taxpayer at the IRS.

CFP Designations: Why it is Important to Your Career in 2025

Which one you choose will depend on your areas of interest and expertise. Additionally, you will need to decide how much time, money, and energy you must put into meeting the requirements. EA’s only tend to focus on preparing taxes, and many specialize in tax resolution. In addition to an IRS-administered testing and application process, enrolled agents must complete at least 72 hours of continuing education every three years. EAs, or enrolled agents, are tax preparers authorized to represent taxpayers before the IRS. Their clients are individuals, partnerships, corporations, estates, trusts, and any entities with tax-reporting requirements.

CPAs possess a more generalized skill set, balancing tax work with other financial services. EAs focus exclusively on taxation, making them specialists in this area, particularly in dealing with the IRS. CPAs, however, have a broader range of responsibilities, including accounting, auditing, and financial analysis, alongside their tax-related work. EAs and CPAs are tax preparers who do tax reports, including quarterly, yearly, and multistate tax audit reports on behalf of their clients.

• If you’re facing an IRS audit or tax disputes or need representation before the IRS, an EA might be your best bet—they specialize in tax-related matters.
• CPAs are state-licensed professionals who provide accounting, tax, financial planning, and consulting services to individuals, businesses, and other organizations.
• Overall, you must pass each exam part within a rolling two-year window.
• Free up time in your firm all year by contracting monthly bookkeeping tasks to our platform.

HOW ARE ENROLLED AGENTS LICENSED?

Therefore, they may have a tax specialization, such as tax preparation or resolution. For this reason, a CPA specializing in tax should consider earning the EA to demonstrate their tax expertise. EAs must either pass the Special Enrollment Exam (SEE) or have previous IRS work experience. The SEE focuses solely on tax law, and while it’s challenging, it’s not as broad as the CPA exam. EAs must also complete continuing education to keep their credentials up to date.

There are several potential advantages to hiring a local tax professional. Meetings and phone calls can be scheduled without having to worry about traveling far or time zone differences. To become an EA, candidates generally must pass a three-part test, apply for enrollment with the IRS, what does ea stand for in accounting and pass a background check (including verification of past tax compliance). Certain IRS employees don’t have to take the exam because of their experience with the tax agency.

Social and customer reviews

However, if you currently meet the EA requirements, it may benefit you to continue on this path before working on your CPA license. In the world of accounting, there are numerous acronyms and abbreviations that can be confusing, even for professionals. One common question that many accountants and bookkeepers face is What does EA stand for in accounting?

EA vs CPA: Which One is Right for You?

We compare how they differ and where they overlap so that you can feel confident and informed when planning your career. I am the author of How to Pass The CPA Exam (published by Wiley) and the publisher of this and several accounting professional exam prep sites. The CPA Exam has four parts, and the exam content is much, much broader. (Plus, the exam has now has CPA Discipline sections, too.) The CPA Exam section equivalent to the EA exam is Regulation (REG). Only around 70% of the REG material relates directly to the EA exam, while the rest covers other topics such as business law. If you own a small business, hiring a CPA with a bookkeeping and reporting background can help you get organized and on track for the next year.

• With such tight deadlines, relying on a CPA review course and faithfully adhering to a consistent study schedule is even more critical for achieving CPA Exam success.
• You’ll need to decide for yourself which is a better fit for your skills and lifestyle.
• You need a 75% pass rate for each section to qualify as a CPA and complete the exam in an 18-month window.
• EAs must also complete continuing education to keep their credentials up to date.

A certified public accountant, CPA, is a professional designation provided to licensed accounting professionals. The CPA license is provided by the Board of Accountancy for each state. To become a CPA, there is a series of exams that must be passed, known as the Uniform CPA Exam. CPAs are also allowed unlimited representation rights before the IRS. A certified public accountant will usually choose a specific area to specialize in, much like a medical doctor. Some may choose taxation while others may choose another area and never prepare tax returns or represent taxpayers before the IRS.

WHAT IS JOCK TAX IN THE UNITED STATES?

We offer a full suite of financial services, from tax strategy to outsourced CFO services and business advisory. Because they’ve met rigorous educational and experience standards, you get a higher level of insight and service. However, that fee will likely be based on the amount of time the tax preparer expects to spend on your return.

The CPA and EA designation are provided by the individual state board of accountancy and IRS, respectively after applicants fulfill the licensing requirements. The roles and responsibilities between a CPA and an EA are not mutually exclusive. They have overlapping roles, such as preparing and reviewing tax returns. However, some key differences between the two could help you understand their strengths. EAs have a national credential that gives them unlimited practice rights¹ to represent any taxpayer for any tax case across all IRS jurisdictions.

All three sections use multiple-choice questions and allow for 3.5 hours each. If you sit for more than one exam section in a single session, you can take an optional 15-minute break after completing the first part. However, the exam timer will continue to count down during unscheduled breaks.

EAs and CPAs both can be tax experts, and the work they do is often similar, but there are some differences between an EA vs CPA. To understand the difference between an EA and a CPA, you should start with the responsibilities of each. The core requirements include passing scores on all three sections of the Special Enrollment Examination or five years of IRS employment drawing on your detailed knowledge of the Internal Revenue Code.

Each exam part lasts a total of four hours, including a short break. Regarding accounting credentials, the CPA and EA are both good options. Plus, they each have pros and cons and distinct effects on your long-term career. EAs help ensure clients are treated appropriately by the IRS, work out payment plans on the best possible terms, and ensure the IRS follows laws that protect taxpayers, Miles says. For example, a base flat fee for your tax return, plus additional hourly charges for any extra consultation needed.

Why is So Much Tax Deducted from My Paycheck? Breaking Down Federal Tax Deductions

FATPs are allowed to represent taxpayers in all proceedings before the Internal Revenue Service including audits and appeals. An Enrolled Agent (or EA) is a tax professional recognized by the United States federal government to represent taxpayers in dealings with the Internal Revenue Service. Enrolled Agents and Certified Public Accountants are licensed professionals who can handle the tax issues of an individual or a business. Jeremias Ramos is a CPA working at a nationally recognized full-service accounting, tax, and consulting firm with offices conveniently located throughout the Northeast. Jeremias specializes in tax and business consulting with focus areas in real estate, professional service providers, medical practitioners, and eCommerce businesses.

With Taxfyle, your firm can access licensed CPAs and EAs who can prepare and review tax returns for your clients. You can connect with a licensed CPA or EA who can file your business tax returns. It’s important to carefully consider your needs and choose a qualified professional to meet them. Both CPAs and EAs are qualified professionals who can provide valuable services, but they have different areas of expertise and may not be suitable for all situations. As for employment situations, jobs for CPAs and EAs usually take place in different environments.

No matter which option you choose, Becker can help you achieve your goals. This chart presents the totals for the Enrolled Agent exam and the CPA Exam costs. Keep in mind these are minimum costs – they don’t take retakes or more expensive prep materials into account. All in all, while there may be exceptions to the rule, the CPA license generally has a much higher barrier of entry than the EA credential. As you’ll see, the basic steps are the same, but the manner in which you fulfill the requirements differs. Get a brief on the top business stories of the week, plus CEO interviews, market updates, tech and money news that matters to you.

Not all CPAs do taxes but not all EAs are capable of handling your taxes. This article will help you decide not only what professional tax preparer you need but also how to test if the tax professional you pick is competent. Some sources recommend pairing EA certification with CPA licensure.