03 Sep CPA, enrolled agent, tax attorney: Which do I need?

Q. What’s the difference between a CPA and an enrolled agent and a tax attorney? How can I decide which I might need?
— Confused

A. Deciding what kind of tax professional you need depends on what you need them for.

Let’s go over the differences.

A CPA is a certified public accountant.

To become a CPA you must have the required education of 150 hours and pass a four-part examination, said Martin D. Hauptman, an attorney with Mandelbaum Salsburg in Roseland.

He said a CPA would typically be involved with a business, preparing financial statements, conducting audits and filing tax returns.

An enrolled agent is a person who has passed an IRS examination to establish a minimum level of proficiency in the tax area, he said

“An enrolled agent would typically represent the client before the Internal Revenue Service at the audit level,” he said.

A tax attorney is an individual who has passed the bar examination, is admitted to practice law in at least one state and practices in the tax area, Hauptman said. A tax attorney would be involved with planning, such as business reorganizations, wills and trusts.

“A tax attorney, if admitted to the U.S. Tax Court, can represent a taxpayer in tax court,” he said. “A CPA and enrolled agent cannot represent a taxpayer in U.S. Tax Court.”

Also, Hauptman said, a tax attorney has the advantage of an attorney-client privilege of confidentiality. Neither a CPA or an enrolled agent have this privilege, he said.

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This story was originally published on Sept. 3, 2019.

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