Professionals in the tax industry who are interested in furthering their careers in accounting and taxes sometimes find themselves torn between the Enrolled Agent and Certified Public Accountant designations.
Both the Certified Public Accountant (CPA) and the Executive Assistant (EA) designations are valuable credentials that may advance your career, increase your compensation, and provide valuable direction.
Having a CPA or EA on your resume is a good first step toward a successful career, but before you take that leap, you should familiarize yourself with the distinctions between the two.
Comparison Between CPA And EA
|Costs involved||CPA certification costs $2,000 to $15,000. No matter where you receive your bachelor’s degree or whether you get a master’s degree within the time limit, costs will be incurred (150 credits). If you opt to study for the CPA exam, you may spend $300-$400. The cost of the exam varies by state.||Becoming an EA requires a $50 PTIN from the IRS. Each test segment costs $111.94. Passing and registering costs $30. This costs $415.82. The vendor’s program must be IRS-approved.|
|Training Time||A CPA takes nine years to become. One hundred fifty college hours are required to take the CPA exam. The CPA exam pass percentage is low, and you have 18 months to prepare. In a state that requires two years of job experience, you’ll need eight and a half years to study for the test.||Executive Assistants may advance quickly. You must pass a three-part IRS exam before applying for a license. If your employment qualifies, you may bypass the IRS exam. EAs usually have tax return preparation and analysis expertise. Field time can’t be quantified.|
|Earnings||After a specific length of time, an AE’s anticipated earnings will plateau and peak at about $60,000. Certified Public Accountants (CPAs) have various choices for growing their revenue sources. If you’re a partner in a firm that offers chief financial officer or CPA services to a worldwide organization, you may make six figures per year.||Depending on their experience and skill, a CPA may make more than an EA. A CPA’s salary is projected to exceed that of an executive assistant in the near future.|
|Exam requirements||If you want to be able to call yourself a certified public accountant, you will need to score well on all four portions of the Certified Public Accountant test.||Either you need to take and pass all three portions of the Special Enrollment Examination (SEE) in order to become an EA, or you need to have formal experience working for the IRS, tax-related technical competence, and a history of ethical conduct in order to become an EA.|
Major Difference Between CPA And EA
Who exactly is CPA?
Both the CPA and the EA are tax credentials. However, EAs are governed by federal law and CPAs by state.
To get one’s CPA designation, candidates must complete 150 hours of coursework and pass all four sections of the AICPA’s Certified Public Accountant Examination.
Certified Public Accountants may only legally work inside the boundaries of their own state or territory.
However, in rare instances, they may be able to operate in another state thanks to reciprocity agreements.
Key Difference: CPA
- The Certified Public Accountant has a solid reputation for achieving excellent results across the board.
- It takes most people between eight and twelve months to prepare for and pass the CPA exam.
- The Certified Public Accountant Examination is partitioned into four separate parts for your convenience.
- The exam for Certified Public Accountants is much more challenging than the Exam for Enrolled Agents.
- A broker with a CPA qualification might reasonably anticipate an annual salary of close to $60,000 throughout their career.
Who exactly is EA?
One kind of tax preparer, known as an EA, specializes in handling the tax affairs of individuals and corporations alike.
Income, payroll, returns, gifts, estate, levies, inheritance, non-profit, and retirement taxes are just a few of the areas in which enrolled agents specialize.
The federal government officially acknowledges a person as a tax expert or specialist in the United States after passing the EA qualifying test and receiving their EA certification.
Key Difference: EA
- There are fewer credits available to be purchased via the AE broker.
- To become a candidate for EA, the process normally takes between one and three months.
- You will need to get a passing score on all three components of the examination to be considered for the post of EA candidate.
- When compared to the CPA, the EA is far simpler and easier to grasp.
- The wages of an EA agent are often rather modest, averaging about $40,000 per year on average.
Contrast Between CPA And EA
- CPA- Becoming a certified public accountant typically takes 8–9 years. You need 150 semester or quarter hours of college work to appear for the Certified Public Accountant test.
You’ll have 18 months to study for and take the Certified Public Accountant test, which has a very low pass rate.
For this reason, eight and a half years should be included if you live in a state that needs two years of professional experience and you use the full 18-month testing window.
- EA- To become an Executive Assistant now requires less time. To get licensed by the IRS, you must first take and pass a three-part test.
If you work in a field recognized by the IRS, you may be able to avoid taking the test. Applicants obtaining EA designation should typically have substantial experience in tax return preparation and analysis. But time spent in the field cannot be measured.
Cost of license:
- CPA- Getting your CPA certification is an investment that will have varying returns. Costs will be incurred regardless of where you get your bachelor’s degree or whether you will earn a master’s degree within the allotted time frame of 150 credits.
Costs might go up by another four figures if you decide to invest in CPA test prep resources.
To what extent you have to pay to take the test is determined only by the state where you want to use the results to get your license.
- EA- Fees of $50 are required to obtain a PTIN from the IRS to begin employment as an EA (Personal Tax Identification Number).
This exam will cost you $ 111.94 for each section. You’ll need to pay $30 to register when you’ve passed the exam. At this point, the total is $415.82. The strategy can’t be used unless the IRS approves it.
- CPA- After some time has passed, an AE’s potential earnings will ultimately approach a plateau, at which point they will reach a high point of around $60,000.
Certified Public Accountants have access to a wide variety of various avenues they might follow to increase the amount of money they bring in.
You may easily be able to record an income in the six figures if you are a partner in a company that offers CPA or CFO services to a multinational firm.
- EA- Depending on the amount of skill and specialty that a CPA has, they may make a substantially higher salary than an EA.
On the other hand, the salary of a certified public accountant will shortly exceed that of an executive assistant in the not-too-distant future.
Way of working:
- CPAs – certified public accountants- have the authority the United States government granted them to represent taxpayers in all Internal Revenue Service (IRS) dealings.
If you need help with your taxes, there is a high possibility that the same specialists who manage this element of your finances may also aid you with financial planning, accounting, and other tasks that are associated with this area of your life.
- EA- If you are having troubles with the IRS, whether it be a collection problem or an audit, an EA is likely to be the best choice for you to consider at this point in time.
The great majority of EAs have little to no trouble communicating with the IRS, and some of them have even previously had positions inside the agency as agents.
Frequently Asked Questions (FAQs)
Q1. Is it worthwhile to get your CPA certification?
Obtaining the Certified Public Accountant (CPA) certificate requires a significant time investment and a challenging testing procedure.
Additionally, accountants with a CPA certification have a greater chance of advancing to positions with a higher degree of responsibility during the first one to two years of their employment.
They often get promotions to senior-level positions within a few years after that.
Q2. Which is more valuable, an MBA or a CPA degree?
A master’s degree in business administration, often known as an MBA, is an academic degree. The Master of Company Administration may be the most appropriate degree for you to pursue if you are considering opening or managing a business.
Certified Public Accountants are professionals who have received the CPA qualification. If you are a “numbers person” or are exclusively interested in accounting, the Certified Public Accountant designation may be more appropriate for you.
Q3. What exactly are a Certified Public Accountant’s responsibilities?
A Certified Public Accountant (CPA) may be engaged in one or more parts of the accounting profession, depending on their specific position.
Certified Public Accountants (CPAs) can specialize in fields such as forensic accounting, personal financial planning, and taxes.
In addition, CPAs are expected to maintain a high level of ethical behavior and meet continuing education requirements.
Q4. How does one go about being enrolled as a federal agent?
To become an Enrolled Agent, one must first get a preparer tax identification number, then take and pass the Special Enrollment Exam, then enroll as an agent, and finally prove eligibility (through, for instance, a background check) to perform the responsibilities of an Enrolled Agent.
Former agents of the IRS have at least five years of experience working as tax specialists in the area.
Q5. To be an Enrolled Agent, what are some of the responsibilities?
The national government of the United States of America recognizes some taxpayer representatives as “Enrolled Agents,” who are authorized to represent their clients before the Internal Revenue Service.
Enrolled Agents help taxpayers with their tax returns (IRS). In addition to this, they may provide their customer’s tax counseling, tax planning, and tax preparation services.
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