To become an EA, one must pass the Special Enrollment Exam.

Some people say EAs are the only “true tax experts” because we’re the only pros who are tested in tax preparation.

This is not exactly true.

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The SEE is not a tax preparation exam.

The SEE is an exam that tests over the Internal Revenue Code but you are never asked to actually prepare a 1040.

So I think it’s better to say EAs are experts over the tax code rather than in tax preparation. To me, that’s a better selling point anyway because it shows we know the full scope of what’s happening with a person’s tax situation.

There are 3 parts to the SEE:

  1. Individual taxes
  2. Business taxes
  3. Representation and ethics

It’s been more than 5 years since I passed the SEE, but here are my recollections of each part.

Part 1

I recall questions about who qualifies as a dependent, filing status issues, and several questions about specifics of taxation of non-resident aliens. The non-resident alien questions threw me for a loop because it wasn’t covered in my study materials.

I remember distinctly that you had to know how to calculate the credit for daycare expenses by hand.

There were exactly 0 questions where you had to prepare a tax return or even calculate AGI. The questions were mainly about applying the rules. Who qualifies as a dependent? Does this taxpayer qualify for this tax credit?

Part 2

I loved Part 2. I actually thought it was fun. Yes, really.

This was the section on business taxes, and it was a fun brain exercise.

Question after question about calculating basis in an S-corp or partnership.

Question after question about depreciation and gain or loss on disposal of assets.

Part 3

I hated Part 3. Everyone downplays test sections over ethics because “it should be common sense.”

I don’t recall any questions where you were asked “what to do” in a certain scenario. Instead, it was all about memorizing form numbers. Knowing the difference between Form 433-A and 433-B, for example.

One of the more bizarre questions was: What do the letters of CAF (as in, a practitioner’s CAF Number) stand for? The answer is Centralized Authorization File. But the possible answers were written in such a way to totally confuse you. “Central Authorized File,” and so forth.

Grading

The test is taken at a testing center, and the computer tells you immediately whether or not you passed. Strangely, if you pass you are not told your score. You only get your score if you failed. If you pass, the computer simply says you passed, with no score given.

For more information about the SEE, visit the “Become an Enrolled Agent” page on the IRS website.

Image courtesy of Nemo on Pixabay.com

“This blog post, along with comments that may follow, should not be considered tax advice. Before you make final tax or financial decisions, please secure a professional tax advisor to give you advice about your unique situation. To secure Jason as your accountant, please click on the ‘Services’ link at the top of the page.”