EA vs. CPA: What’s the Difference Between These Certifications?

When it comes to pursuing a career in accounting or tax-related fields, two certifications often come up: Enrolled Agent (EA) and Certified Public Accountant (CPA). While both credentials signify a high level of expertise and can open doors to various opportunities, they differ in their scope, requirements, and areas of specialization. In this article, we’ll explore the key distinctions between the EA and CPA certifications, helping you understand which path may be the right fit for your career goals and aspirations.

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What Is an Enrolled Agent (EA)?

An enrolled agent, or EA, is a tax professional who focuses on managing tax arrangements for business or private entities. EAs boast a wide range of knowledge in tax-related subjects such as income, estate, gift, payroll, levies, returns, inheritance, non-profit and retirement taxes.

Once EAs have passed their qualifying exam, the federal government recognizes them as tax specialists. Typical EA responsibilities include representing business or individual clients in tax audits, tax appeals and tax collections. Additionally, EAs can also provide tax advice, tax return filing and more.

An EA is the highest credential the IRS awards. You’ll want to seek out an EA for any tax-related issues. According to the IRS, they are uncontested experts on such topics.

What Is a Certified Public Accountant (CPA)?

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.

CPAs typically do most of their work for public accounting firms of all sizes. They could be specifically licensed as auditors, financial planners, corporate and executive accountants and tax consultants. So, CPAs could assist in all accounting, tax and financial services for the businesses, individuals and other organizations they may represent.

CPAs help clients set and achieve financial goals through money management and financial planning. These goals could include anything from putting a down payment for a home to opening a new branch of business across the country. In other words, a CPA is the go-to if you’re looking for a broad scope of expertise.

Costs and Processes of Becoming an EA and CPA

To become an EA, one must pass an IRS-administered exam. There are three sections to the exam, which cover individuals, businesses and representation and practices and procedures. The cost of each section of the exam is about $267. There is also a continuing education component that entails taking 72 credits every three years.

To become a CPA, a person must take 150 hours of public accounting courses, typically done at a college or university. Though requirements vary by state, it is common for those aiming to become CPAs to take a review course before sitting for the four-part exam, and these courses run anywhere from approximately $1,200 to $3,500.

Application fees for the exam vary by state but are around $100. Each of the exam’s four sections costs about $200, depending on the state. There is also a continuing education component, but the exact number of credit hours varies by state.

What’s the Difference Between EAs and CPAs?

Now that you know what CPAs and EAs do in practice, here’s a side-by-side comparison of their main focuses, wider skill sets and hourly rates:

Differences Between CPA & Enrolled Agent

EA vs. CPA: Which Is Best for You?

When deciding between an EA or a CPA, you will see that both types of professionals are well-qualified. They can both deliver the financial guidance you may need for your taxes. However, which one you should consult depends on which issue you want to resolve.

EAs can help you work through an IRS audit or a collection problem, and they can also perform bookkeeping services that could be useful for businesses when preparing tax returns. CPAs, however, are more adept at meeting your financial planning and accounting needs, and when it comes to tax planning, they can also help you identify tax credits and deductions to lower your tax liability.

Choosing between an EA and CPA certification also depends on the career opportunities and flexibility you seek. EAs are tax experts who can represent clients before the IRS, making them highly valuable during tax season. Their expertise is particularly beneficial for individuals and businesses seeking specialized tax advice. CPAs, however, enjoy a wider range of career opportunities beyond tax preparation, including roles in auditing, management consulting and financial analysis. This versatility allows CPAs to work in various industries and positions, offering greater career flexibility.

You may be able to find what you’re looking for with either type of professional, as both types of professionals are equally qualified to perform similar tasks. However, there can be differences in the range of services offered. CPAs can provide a much wider scope of tax services than an EA can. What’s more, the general population demand is greater for CPAs than EAs.

If you have accounting needs with a micro focus, working with an EA could be the perfect fit for you. On the other hand, if you are interested in accounting practices that have nothing to do with taxes, such as auditing, then the CPA option may be best.

Bottom Line

When deciding between working with an EA or a CPA, you can rest assured that both types of professionals are well-trained. They must pass rigorous exams and can do difficult and demanding work for clients. And because tax attorney fees can often climb well into the four figures, both CPAs and EAs are also affordable alternatives for those who need help figuring out tax obligations. Be sure that if you choose to consult with either type of professional, you have a solid handle on your finances and measure your expectations.

Tips for Managing Your Taxes

• You may want to consider working with a professional financial advisor before speaking with a CPA or EA. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
• SmartAsset’s tax return calculator can tell you how your income, withholdings, credits and deductions impact the amount due on your returns and any credit you may be entitled to.

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