Difference Between CPA and EA (Enrolled Agent)
Enrolled Agents (EA) and Certified Public Accountant (CPA) are licensed professionals who can handle the tax issues of an individual or a business. The primary difference between the two is that the license of an EA is authorized by the federal government, i.e., the Internal Revenue Service (IRS), giving them nationwide authority. The CPA license is issued by any of the 55 U.S. states, restricting a CPA’s authority to the state level.
CPA vs EA debates are a common occurrence in the life of an aspirant seeking a job in the sphere of accountancy. The roles of EAs are centred around taxation but holding greater authority as they represent their clients before the IRS. CPAs’ range of services goes beyond taxation as they could be public accountants, tax accountants, personal finance managers, business consultants, auditorsAuditorsAn auditor is a professional appointed by an enterprise for an independent analysis of their accounting records and financial statements. An auditor issues a report about the accuracy and reliability of financial statements based on the country's local operating laws., controllersControllersThe financial controller is one of the senior-level executives of the company who is responsible for managing all the finance and the accounting, preparation and publishing of the financial statements such as the balance sheets, cash flow statement and the income statements timely, auditing compliance, and coordinate in the preparation of the economic forecast of the company., or federal officers, etc.
Table of contents
What is a CPA?
Certified Public Accountant (CPA) is a professional who is licensed to carry the duties of –
- Financial Advisor
- Tax specialists
- Financial Planner
- Individual and Business Consultants
- Chief Financial OfficerChief Financial OfficerThe full form of CFO is Chief Financial Executive, and he or she is a top level executive of the firm who is responsible for the firm's overall finance functions and has the authority to make financial decisions for the organization.
For example, you are taking the services of a CPA to manage your accounts and financial services. In this case, the CPA will help prepare your accounts, audit them, file tax returns, give financial advice to grow your wealth and save taxes. To become a CPA, you must clear the four parts of the CPA exam administered by AIPCA. You get 18 months to pass the sections in an exam cycle. Each state has a body that governs the CPAs. The states hold specific eligibility criteria to qualify for the exam in terms of age, experience, educational qualifications, etc. You can learn more about the CPA application processCPA Application ProcessThe CPA application process often leaves aspirants with a lot of questions. The Certified Public Accountant (CPA) examination is a license issued by 55 states and territories in the USA. After obtaining the CPA license, you can practice as a certified financial advisor. here.
For example, some states need 120 credit bachelor’s degree while others mostly require 150 credit college degree. Also, it is important to have done a relevant accounting and business course. After passing all four sections, you qualify to become a CPA. A wide range of roles and handsome salaries are offered based on your experience and skills.
What is an Enrolled Agent (EA)?
- An enrolled agent (EA) is a professional authorized by the IRS. Having an EA badge is highly coveted as it is the highest credential awarded by the IRS.
- EAs specialize in taxation, holding credentials and expertise to handle even the most complicated matters. They represent their clients before the IRS concerning audits, collections discrepancies or appeals, etc.
- They have unrestricted freedom to choose any taxpayers from any part of the country amongst individuals and businesses. They also have the freedom to choose tax matters and the IRS office to represent their client.
- To become an EA, you must pass the three parts of the Special Enrollment Examination (SEE) exam. If you clear one part, you can retake others, as the score stays valid for two years. Former IRS employees with technical IRS expertise and ethical practice conduct can be awarded this status.
- After obtaining the EA status, ethical adherence becomes a must, and every three years, completing 72 hours of continuing education courses. Like CPA, EA also offers a handsome salary based on the seniority level.
CPA vs EA Infographics
Comparative Table – CPA vs EA (Enrolled Agent)
Let us take you through a comparative table to take a deeper look at the CPA vs EA discussion.
|Accountant, Financial Advisor, Tax Specialist, Consultant, CFO, Auditor, Controller, etc.
|Tax specialists who represent their clients before the IRS.
|Different states have a professional body that handles licensing.
|The federal government, IRS.
|To be a professional, you must pass the four parts of the CPA examCPA ExamA Certified Public Accountant (CPA) is a US state board-issued license to practice the accounting profession.
|To be an EA, you must pass the three parts of the Special Enrollment Examination (SEE).
If you have worked with the IRS formally, hold technical expertise related to taxation, and have ensured ethical conduct, you can become an EA.
|Sections in the Exam
|Must pass all four sections within 18 months. A minimum score of 75 on each part is required.
|Section test scores normally stay valid for two years giving sufficient time to pass other sections. Due to Covid-19, the number has been extended to three.
A scaled passing score is 105.
|$180 to $200 per exam section.
|$206 fee per exam part.
|A CPA with a year of experience earns around $66,000 a year.
|The annual expected salary ranges between $ $40,000- $65,000 based on seniority.
This has been a guide to CPA vs EA (Enrolled Agent). Here we discuss the top 7 differences between CPA vs EA along with infographics. You may also have a look at the following useful articles –
- CPA Books and Study GuideCPA Books And Study GuideThe top CPA study books are - CPA exam for dummies, Guide for international candidates, McGraw-Hill education 2,000 review questions for the CPA Exam, The vest-pocket CPA: second edition, How to prepare for the certified public accountant exam.
- CPA vs CMACPA Vs CMAThe full form of CPA is Certified Public Accountants and is pursued by students interested in auditing, management accounting, accounts handling, taxation, etc. In comparison, the full form of CMA is Certified Management Accountant and pursued by students keen on learning budgeting and management accounting.
- Accounting vs CPAAccounting Vs CPAAccounting is the process of recording, maintaining, and reporting the financial affairs that show the company's clear financial position. In contrast, CPA is the designation given to those individuals who clear the CPA examination by the American Institute of Certified Public Accountants.