If you are an enrolled agent, you specialize in tax issues period — such as preparation of taxes for individuals and business entities or advising clients. Job opportunities for you may be found at tax preparation franchises or working for a CPA. A CPA’s careers choices are much greater and you could work for the government, in the private sector or for individuals. Some examples of job titles held by CPAs include CFO, controller, tax specialist or auditor.
Many people choose a specific career path based on potential earnings. Although most people have heard of CPAs, fare less are familiar with the work of EAs are not aware of their potential income level. You just have to clear the three-part examination administered by the Internal Revenue Service and then apply for the license. In order to get the CPA license, you must have 2 years of relevant experience and pass the ethics exam. Therefore, they may have a tax specialization, such as tax preparation or resolution.
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Although your exact salary will depend on a number of factors, including the state you live in, in general, CPAs tend to have higher salaries. For a more detailed look at the EA versus CPA Exams and a direct comparison of CMA vs CPA vs EA exams, check out https://personal-accounting.org/accounts-receivable-turnover-ratio-formula-and/ our post on the difficulty of the EA exam. 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. The CPA Exam has four parts, and the exam content is much, much broader.
- The CPA Exam section equivalent to the EA exam is Regulation (REG).
- With his help, countless students and professionals have passed certification exams and achieved their dreams.
- EAs are not as common in the business sector, which means that you could choose to work from home.
- This means that if you fail one part, you have the option to retake it sooner than you could before.
- So, with the EA license, you’ll be known as the most committed and qualified tax professional.
Certified public accountants, or CPAs, have a more flexible and expansive repertoire than EAs. They deal in all sorts of realms within the tax world, making them a great choice if your questions involve multiple topics. In addition, states approve CPAs, while the federal government approves EAs. So there you have, it my list of reasons that all return preparers should become an EA. If you’re an experienced 1040 preparer, then Part 1 of the SEE should be a cake walk. Part 3 requires very little study, and is often the one I suggest people take first.
EA Salary vs CPA Salary and Career Prospects
I have a reader who actually made more during those few months than he usually earns for the year in retail. Both types of professionals are equally qualified to perform similar tasks, but there are differences in the range of services offered. CPAs can provide a much wider scope of tax services than an EA can. What’s more, general population demand is greater for CPAs than EAs.
Enrolled agents are typically employed by businesses specializing in handling income tax resolutions or preparing tax returns. CPAs, or Certified Public Accountants, are licensed accountants who specialize in providing financial advice and services to businesses and individuals. They typically prepare taxes, review and consult on financial statements, and provide audit services. Finally, once you pass the EA exam and are ready to become an enrolled agent, you’ll have to pay the IRS $140 to complete the enrollment process.
Enrolled Agent vs. CPA: Which Certification is Better for You?
You have to pass a three-part exam administered by the IRS then apply for licensure. Qualifying employment with the IRS could exempt you from having to take the exam. It is most common for individuals to have a proven record in tax preparation and analysis before seeking EA status. EA salaries depend on a variety of factors, such as the number of years of experience, type of experience, and work location.
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- Unlike CPAs, enrolled agents become nationally certified, so they can practice in any state with the same certification.
- When it comes to professional focus, EAs and CPAs cover distinct areas of expertise.
- Other tasks include preparing tax returns, performing tax accounting reconciliations, teaming up with the different departments regarding any tax issues, etc.
- According to Payscale.com, enrolled agents typically make anywhere between $30,000-$75,000 a year, while CPAs make between $40,000-$104,000 annually.
- Generally speaking, interested candidates should have a background in public accounting.
To become an enrolled agent you should focus your studies on taxation and take the SEE. To take the enrolled agent exam, you must enrolled agent vs cpa salary pay a testing fee for each exam part. The exam has three parts, and the testing fee is $206, which comes to a total of $618.
CAREER OPPORTUNITIES FOR ENROLLED AGENTS
And yes, there are also a few other CPA Exam fees you’ll need to budget for, depending on your situation and testing track record. According to Payscale.com, enrolled agents typically make between $33K to $80K a year, while CPAs make between $49K to $115K per year. Enrolled agents also have the opportunity to earn extra money during tax season.
An enrolled agent is a tax practitioner who is licensed at the federal level by the Internal Revenue Service. In fact, enrolled agent status is the highest credential awarded by the IRS. On the other hand, certified public accountants are licensed by their applicable state boards of accountancy.