Individual Tax Planning

5 Crucial Questions to Ask an IRS Enrolled Agent Before Hiring Them

by
Jon Osborn
on
7/31/2023
5 Crucial Questions to Ask an IRS Enrolled Agent Before Hiring Them

Working with an IRS Enrolled Agent can be a smart move for individuals seeking professional tax assistance that goes beyond the basics. Enrolled Agents (EAs) are federally licensed tax practitioners with specialized expertise in tax matters. Before hiring one of these experts, it's essential to ensure they have the qualifications and experience you're looking for. This article outlines the top five questions individuals should ask an IRS Enrolled Agent before hiring them.

1. Are You an IRS Enrolled Agent?

Before you do anything else, ascertain that the tax professional you're interviewing is, in fact, an Enrolled Agent. EAs must pass a rigorous three-part examination administered by the Internal Revenue Service (IRS). This exam tests their knowledge of tax law, tax preparation, and representation of clients before the IRS. It is divided into three sections:

Part 1 – Individuals

Part 2 – Businesses

Part 3 – Representation, Practice, and Procedures

Additionally, EAs must meet annual continuing education requirements to maintain their status. Verifying their enrollment status on a regular basis ensures that they possess the necessary knowledge to continue representing American taxpayers.

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Credit: Pekic/Getty Images

2. How Many Years of Experience Do You Have?

Experience is a vital factor in assessing whether you want to work with a specific IRS Enrolled Agent. Inquire about how long they have been working with diverse clients and handling various tax situations. An Enrolled Agent with a substantial track record is likely to have encountered scenarios similar to yours, and will therefore be better equipped to provide accurate tax advice tailored to your circumstances.

3. Do You Have Experience Handling Cases Similar to Mine?

As alluded to in the previous question, every individual's tax situation is unique. It is important to find an EA who has experience handling cases similar to yours. Whether it's related to business taxes, complex investments, or tax issues arising from life events like divorce or inheritance, make sure the agent has expertise in dealing with similar scenarios.

Many Enrolled Agents deal with a variety of situations but some have niches. This can be helpful, especially for taxpayers who are facing specific tax problems. An EA who has familiarity with similar cases will have the best idea of how to help these individuals.

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Credit: Alvaro Gonzalez/Getty Images

4. Are You Willing to Represent Me Before the IRS?

Often, when someone seeks out assistance from an Enrolled Agent, their tax problems have already gone beyond what a general tax preparer feels qualified to handle. One significant advantage of working with an EA is their ability to represent clients before the IRS.

Before you sign a contract, make sure the agent is authorized to represent you in tax matters, such as audits, appeals, and collections. Having an Enrolled Agent who can communicate and negotiate on your behalf can alleviate stress and increase the chances of a favorable resolution to your tax issues.

5. What Are Your Fees and Billing Options?

Even though talking about money can feel uncomfortable, discussing fees and billing options upfront is the best way to avoid any misunderstandings later on. Enrolled Agents generally charge fees based on the complexity of your tax situation and the services provided. Some may charge an hourly rate, while others may offer a flat fee for specific services.

Request a clear breakdown of your agent's fee structure. Additionally, inquire about long-term payment plans and any potential retainer requirements. 

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Credit: Alistair Berg/Getty Images

Choosing the right IRS Enrolled Agent can play a key role in whether you successfully get out of tax trouble. By asking the right questions, such as those outlined above, individuals can make an informed decision. Working with a qualified and experienced EA offers peace of mind, knowing that your tax matters are in capable hands.

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Feature Image Credit: Courtney K./Getty Images

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Jon Osborn

Jon Osborn

Steward Financial Services
38 reviews

California

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