The true success and key to any flourishing business in today’s world is a solid understanding and regulation of accounts.
If you are just setting out on your journey for your start up business or collaborating with someone for the same, it is necessary for you to gain knowledge regarding accounting and tax services. For young aspirants in this field, it is often a daunting task to learn every acronym used to refer to various tax and accounting services programs. Two of the most commonly used acronyms are EA and CPA, which stand for Enrolled Agent and Certified Public Accountant.
The true success and key to any flourishing business in today’s world is a solid understanding and regulation of accounts. Even though one may hire highly qualified professionals to help them with every financial report, it is absolutely necessary for the hirer to be well versed with the background. Therefore, in this article, you will be guided to know which tax professional—EA or CPA you should hire for your business.
Difference between EA and CPA:
Enrolled Agents (EA) focuses mainly on the management of tax requirements and arrangements for businesses or individuals (private entity). In addition to this, EAs are also eligible for representing their clients for tax collection, audits or appeals and filing tax returns. Private and business tax planning can be made indeed easy if you have an EA because they are well acquainted with the Internal Revenue Service (IRS).
On the other hand, Certified Public Accountant (CPA) are more like your accounts or tax mentor/consultant who will help you achieve your goals by proposing efficient financial plans. Unlike EA, CPA works for business firms mostly. They also perform much broader accounting services compared to EA.
It is best to seek professional help from a financial advisor who can help you decide between EA and CPA. You can look up the Internet to search for tax professionals and select the most appropriate results (for example, accounting services by E.A. Buck Accounting & Tax Services to discuss with your financial advisor. Other tips include for dealing with issues related to IRS, it is best to choose an EA. While, if you have broader financial needs with which you need assistance, for example, compilation of financial data to submit to the bank, then CPA is your best fit.
- Can you shift from working with an EA to CPA or vice-versa?
Yes, you can always shift from working with either of the tax professionals to the other, depending on your needs criteria for the current situation. It can also be possible to work with both professionals if you have much wider financial requirements on a large scale.
Finding a qualified EA or CPA may seem to be a back-breaking job, but it can be made easy by getting in touch with financial advisors, as mentioned above. They will help you choose the right professional as per your needs. As a backup, you can also seek help from an online tax return calculator to help you manage your taxes. Many businessmen overlook the importance of keeping track of their business accounts themselves. This can often lead to unnecessary emergence of situations. For example, in case of an emergency when your EA or CPA professional is not easily reachable, it can be an extremely unwanted situation.