E

  • Earned Income Tax Credit

    A tax credit given to qualified low-income wage earners, even if no income tax was withheld from the individuals pay.

 

  • Enrolled Agent

    An Enrolled Agent (EA) is a federally-authorized tax practitioner who has technical expertise in the field of taxation and who is empowered by the U.S. Department of the Treasury to represent taxpayers before all administrative levels of the Internal Revenue Service for audits, collections, and appeals.

     

    What does the term Enrolled Agent mean?

    Enrolled means to be licensed to practice by the federal government, and Agent means authorized to appear in the place of the taxpayer at the IRS. Only Enrolled Agents, tax attorneys, and CPAs may represent taxpayers before the IRS. The Enrolled Agent profession dates back to 1884 when, after questionable claims had been presented for Civil War losses, Congress acted to regulate persons who represented citizens in their dealings.

    Enrolled Agent" (EA) is a tax professional who has passed an IRS test covering all aspects of taxation, plus passed an IRS background check. Enrolled Agents have passed a two-day, 8-hour examination. The examination (called the Special Enrollment Examination) covers all aspects of federal tax law, including the taxation of individuals, corporations, partnerships, and various regulations governing IRS collections and audit procedures. Like CPAs and tax attorneys, EAs can handle any type of tax matter and represent their client's interests before the IRS. Unlike CPAs and tax attorneys, Enrolled Agents are tested directly by the IRS, and enrolled agents focus exclusively on tax accounting. The "EA" designation may be revoked by the IRS' Office of Professional Responsibility for malpractice.

     

How can Enrolled Agent help me?

Enrolled Agents advise, represent, and prepare tax returns for individuals, partnerships, corporations, estates, trusts, and any entities with tax-reporting requirements. Enrolled Agents expertise in the continually changing field of taxation enables them to effectively represent taxpayers audited by the IRS.

Privilege and the Enrolled Agent: The IRS Restructuring and Reform Act of 1998 allow federally authorized practitioners (those bound by the Department of Treasurys Circular 230 regulations) a limited client privilege. This privilege allows confidentiality between the taxpayer and the Enrolled Agent under certain conditions. The privilege applies to situations in which the taxpayer is being represented in cases involving audits and collection matters. It is not applicable to the preparation and filing of a tax return. This privilege does not apply to state tax matters, although a number of states have an accountant-client privilege with the U.S. Treasury Department.

 

  • Equitable Relief

    If a spouse does not qualify for innocent spouse relief or separation of liability, they may qualify for equitable relief. The taxpayer must show, under all facts and circumstances, that it would be unfair to be held liable for the understatement or underpayment of taxes. (U.S. Master Tax Guide 2004)