Note: If you’re already an EA, CPA, or attorney, then this post will be of zero interest to you. If you’re an unenrolled preparer, however, keep reading…
It’s becoming increasingly common for me to receive emails like this one from a return preparer in Sacramento, CA:
I would like to pursue this opportunity. I am currently not an EA. What ways have others moved ahead until they became an EA? Can I hire one? What do you suggest?
Here was my verbatim reply to this particular email:
By “this opportunity”, I presume you’re referring to collections representation services?
While hiring an EA, CPA, or attorney is definitely an option, I would still encourage you to obtain your Enrolled Agent license yourself. Honestly, the test isn’t that difficult for an experienced tax preparer that puts in a couple weeks of study. The Gleim test prep books are the ones I used, and they were pretty good.
The reason I would encourage you to get your license yourself, even if you hire a licensed person to do the work, is because by IRS regulation, you must be licensed in order to solicit representation services. In other words, it’s a violation for an unlicensed person, even an experienced preparer, to sell licensed representation services.
A couple weeks of study and a few hundred dollars for the tests is a tiny price to pay to be able to sell something as lucrative as tax resolution, in my biased opinion. 🙂
Since this comes up frequently, I figured it was finally worth it’s own blog post, so here we go.
Let’s start with the one thing that I feel I’ve become a broken record about over the past few years:
In order to sell tax resolution services, you MUST be licensed. This is non-negotiable.
I’m starting with this, instead of “why you should be licensed”, because I feel like it’s the most salient point for anybody reading this blog. Most folks end up here because of the information I provide on marketing and selling tax resolution services.
In case you’re not familiar with Revenue Procedure 81-38, this was the original Revenue Procedure covering limited practice without enrollment. Section 8 of this Revenue Procedure explicitly bars individuals that are NOT an EA, CPA, or attorney from soliciting representation services (which is what “tax resolution”) is.