How do the credentials compare?
| Enrolled agent | CPA | Tax attorney | Other paid preparer | |
|---|---|---|---|---|
| Licensed by | IRS, after exams or IRS experience | State board | State bar | None; PTIN only |
| Focus | Tax returns and IRS matters | Accounting, audit and tax | Tax law, disputes, planning | Return preparation |
| Represent before the IRS | Yes, any matter | Yes, any matter | Yes, any matter | Limited, for returns they prepared, with AFSP record |
| Continuing education | Required | Required | Required | Voluntary through AFSP |
All of them must sign the returns they prepare.
Which do you need?
- A simple return: a competent preparer with a PTIN may be enough.
- A business return, IRS notices or back filings: an enrolled agent or CPA.
- Audited or reviewed financial statements: a CPA firm.
- Legal disputes, criminal exposure or complex structuring: a tax attorney.
- Non-resident and foreign-owned LLC filings: someone with specific experience of Forms 5472 and 1040-NR.
Many businesses use a bookkeeper for monthly records and an enrolled agent or CPA for returns and IRS matters, which keeps costs down without losing expertise.
How do you choose?
Check the credential
Through the IRS directory of preparers with credentials, or the state licensing board.
Ask about experience
With businesses like yours and the forms you need.
Agree the fee in advance
Avoid fees based on the size of the refund.
Confirm they sign the return
With their PTIN, and e-file it.
Agree on representation
Whether they will handle IRS notices, using Form 2848. See Form 2848 vs 8821.
Ask for the engagement terms in writing.
What should you ask before hiring?
- Which credential do you hold, and can I check it?
- How many returns like mine do you prepare each year?
- Do you prepare the state returns and any international forms I need?
- Will you handle IRS or state notices about returns you prepared?
- How do you charge, and what is included?
- How will you keep my information secure?
How are fees usually set?
By complexity rather than the size of any refund: the number of forms and schedules, entity type, number of states, whether books are ready, and any catch-up or international work. Fixed fees per return are common for business filings, with separate fees for bookkeeping clean-up or notice work. Ask for a written engagement letter setting out the scope. See bookkeeping cost.
Is tax software an alternative?
For a simple personal return, often yes. For business returns, partnerships, S corporations, back filings or foreign-owned LLCs, the time saved and errors avoided usually justify a professional, who can also represent you if questions arise.
What are the red flags?
- Refusing to sign the return, or asking you to sign a blank return.
- Fees based on a percentage of the refund.
- Promises of larger refunds than other preparers.
- Directing refunds into their own account.
- Not asking for records to support income and deductions.
Who is responsible for the return?
You are. Even with a paid preparer, the taxpayer is responsible for what the return says, so review it before it is filed and keep a copy. Relying on a preparer to file on time is generally not a reason for penalty relief. See reasonable cause.
Keep copies of what you gave the preparer too.
Looking for help with business taxes?
We prepare business and personal returns, keep your books, and represent you with the IRS when notices arrive.
Questions people ask
What is the difference between an EA and a CPA?
An enrolled agent is licensed by the IRS and specializes in tax; a CPA is licensed by a state and covers accounting, audit and tax. Both can represent you before the IRS.
What is a PTIN?
The preparer tax identification number every paid tax preparer must have and use on returns they prepare.
Can any tax preparer represent me in an audit?
Only enrolled agents, CPAs and attorneys have full representation rights. Other preparers have limited rights if they hold an AFSP record.
How can I check a tax preparer's credentials?
Through the IRS directory of federal tax return preparers with credentials, or the relevant state licensing board.
Sources
Every fee, date and rule on this page was taken from these official and primary sources.
- IRS: Choosing a tax professional
- IRS: Directory of Federal Tax Return Preparers with Credentials and Select Qualifications
- IRS: Understanding tax return preparer credentials and qualifications
Rules and fees change. If you are reading this long after October 1, 2026, confirm the figures with the source before you rely on them.
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This guide is general information. It is not tax or legal advice for your situation.