You know you need some financial help with your business. The problem is, you're not sure if you should turn to the help of a CPA or an enrolled agent.
But you're about to find out!
In today's post, we'll break down the roles, responsibilities, and capabilities of an enrolled agent vs. a CPA to help you determine what's right for your organization.
Before we dive into the major differences between these two roles, let's begin by defining each of them.
In this recent post, we break down what an enrolled agent is and whether your business needs one.
In that post, we include this explanation of what an enrolled agent does, straight from the IRS:
"An enrolled agent is a person who has earned the privilege of representing taxpayers before the Internal Revenue Service by either passing a three-part comprehensive IRS test covering individual and business tax returns or through experience as a former IRS employee. Enrolled agent status is the highest credential the IRS awards. Individuals who obtain this elite status must adhere to ethical standards and complete 72 hours of continuing education courses every three years.
Enrolled agents, like attorneys and certified public accountants (CPAs), have unlimited practice rights. This means they are unrestricted as to which taxpayers they can represent, what types of tax matters they can handle, and which IRS offices they can represent clients before."
Now, as for what a certified public account (CPA) does?
Here's how Investopedia defines its role:
"A certified public accountant (CPA) is a designation provided to licensed accounting professionals. The Board of Accountancy provides the CPA license for each state. The American Institute of Certified Public Accountants (AICPA) provides resources on obtaining the license. The CPA designation helps enforce professional standards in the accounting industry. Other countries have certifications equivalent to the CPA designation, notably, the chartered accountant (CA) designation."
These definitions are handy, but they don't tell you when to hire an enrolled agent vs. a CPA for your business. So let's cover that next!
You'll notice that both enrolled agents and CPAs have tax expertise. However, each role has different credentials to establish this expertise. These credentials come into play in several ways when choosing an enrolled agent vs. CPA for your business.
Both offer many important services your business can benefit from. But does it really matter if you choose one over the other?
Well, this depends on the services you're looking for and how your business operates!
With that in mind, here are some examples of when an enrolled agent vs. a CPA would be particularly beneficial for your business:
(You will also have special tax considerations if you are a limited liability company (LLC). Read about those considerations in this post)
Did you know Two Roads has an enrolled agent on our staff who is here to help you with any of your financial and tax needs? Along with our staff of talented bookkeepers and CFO advisors, we have everything you need to help your organization grow.
Filing your taxes shouldn’t feel overwhelming. We help you navigate the process easily and take surprises out of the game for federal, state, and local filings.
Schedule a call today!