This section of the exam pertains to Enrolled Agent procedures for the filing process, and includes topics regarding accuracy; information that is shared with taxpayers; regulations and sanctions; record maintenance; and electronic filing.
Accuracy is an important part of the Enrolled Agent's role as a representative of the taxpayer. Any mistakes can be costly in terms of time, money and reputation. Enrolled Agents must pay special attention to maintain the highest standards of accuracy and be familiar with:
- Duplicate entry recognition
- Inconsistencies with source data
- Tax software
Information Shared with the Taxpayer
Enrolled Agents are required to share certain information with taxpayer clients and should be aware of:
- Consequences of dishonesty
- Record-keeping requirements
- Significance of signature – joint and several liability, penalty of perjury
As an Enrolled Agent, you will be responsible for maintaining client records. It is important to have an understanding of record maintenance requirements, including:
- EITC due diligence requirements
- Rules regarding the return of client records and documents
- Length of time to retain records and returns
- List of prepared returns - name, social security number, type of return
Enrolled Agents can apply to become an Authorized IRS e-file Provider. The IRS encourages filers to become e-file providers to save money and increase productivity. To become an Authorized IRS e-file Provider, Enrolled Agents must create an IRS e-Services Account, submit an application to become an Authorized IRS e-file Provider, and pass a suitability check. Enrolled Agents should understand the following concepts regarding electronic filing:
- Advertising standards
- Appeal process
- Application process to become an e-file provider
- Compliance requirements
- Definitions and responsibilities of an ERO
- Electronic return requirements
- E-file authorization and documentation - Forms 8879 and 8453
- Levels of infractions
- Rejected returns and resolution
Resources For Preparing For The Exam
Financial AdvisorChoosing a life insurance agent is the first and most important step in obtaining coverage. Buyers should pay attention to five key factors.
InvestingBuying or selling a home? What you need to know about real estate agent and broker fees.
TaxesTaxpayers who need to obtain health coverage under the Affordable Care Act can now do so easily and conveniently when they file their taxes through an eligible preparer.
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InvestingTransfer agents maintain the records and documents related to shareholder accounts.
InvestingThe signs of a bad agent go beyond whether your home sells quickly.
InvestingWhile they can be instrumental in helping you buy or sell a home, real estate agents may ulterior motives.
Managing WealthThe rules and timing can be tricky; here's how to navigate them, without getting dinged by penalties.
InsuranceVarious life events and situations enable you to join a qualified health plan (QHP) offered through the marketplace or change to a different plan.