Business owners often ask whether they need an Enrolled Agent (EA) or a Certified Public Accountant (CPA). EAs are federally credentialed tax specialists with nationwide practice rights before the IRS. CPAs are state-licensed accounting professionals who can provide tax, financial reporting, and, where permitted, attest services (audit/review/compilation). At Henriquez Accounting & Tax Services, we coordinate bookkeeping, tax, and advisory so you get clean data and confident decisions. Explore Bookkeeping, Tax Preparation, and Outsourced Controller/CFO.
EA = Federal Tax Expert CPA = Broad Accounting License
Both can prepare taxes. Choose based on scope: tax representation/planning (EA) vs. GAAP/assurance plus tax (CPA).
Quick Definitions
- Enrolled Agent (EA): Federally authorized by the IRS. Focus on tax planning, preparation, and representation (audits, collections, appeals) in all states.
- Certified Public Accountant (CPA): Licensed by a state board. Focus on financial statements, assurance (where allowed), tax, and advisory. Practice rules vary by state.
- Tax Attorney (when needed): Legal strategy, privilege, and litigation (e.g., tax court, criminal investigations, complex settlements).
Licensing, Practice Rights & Scope
Enrolled Agent (EA)
- Federal credential; represent clients before the IRS nationwide.
- Deep tax specialization—entity choice, S-Corp comp, estimates, notices, audits.
- Tax-centric continuing education and ethics requirements.
Certified Public Accountant (CPA)
- State license; broader scope: accounting/GAAP, assurance (per state), tax, advisory.
- Often required by lenders/investors for audited, reviewed, or compiled financials.
- CPE across accounting, auditing, ethics, and tax topics.
Who Should You Hire—and When?
- Hire an EA when you need tax: IRS representation, multi-state mapping, quarterly estimates, entity strategy, notice resolution.
- Hire a CPA when you need financial reporting: GAAP statements, assurance services for lenders/investors—plus tax and advisory.
- Engage a Tax Attorney for privileged legal matters or litigation.
Decision Checklist
- Credentials in good standing (EA/CPA) and current CPE.
- Written scope & SLAs: deliverables, deadlines, and response times.
- Security posture: secure portal, MFA, e-sign, retention policies.
- Industry experience: trades, restaurants, e-commerce, real estate, services.
- Planning cadence: monthly close + quarterly reviews, not just year-end.
How We Support You (Month–Quarter–Year)
Monthly
- Bookkeeping & reconciliations; close with P&L, Balance Sheet, Cash Flow.
- AR/AP cadence; 13-week cash forecast; documentation discipline (receipts, W-9s).
Quarterly
- Tax projections & vouchers; payroll/sales tax checkups; S-Corp reasonable comp review.
- KPI dashboard: margins, runway/DSCR, DSO/DPO/DIO; pricing & budget updates.
Annually
- 1099 filings; fixed-asset rollforward & depreciation; business & owner returns.
- Year-end strategy and next-year roadmap.
Rule of Thumb: If your primary need is tax planning & representation, an EA is ideal. If you need audited/reviewed GAAP financials for banks or investors, involve a CPA. Many growing businesses benefit from both—coordinated.
Common (Costly) Situations We Resolve
- Late/incorrect quarterly estimates → penalties and interest.
- Wrong entity or late S-Corp election → excess self-employment tax.
- Unreconciled accounts & missing support → missed deductions and audit exposure.
- Multi-state sales/use tax for e-commerce/services → surprise liabilities.
What You’ll Get When You Work With Us
- Clean monthly close with audit-ready statements and workpapers.
- Quarterly tax projections with vouchers and due dates.
- IRS/state notice handling and representation by an Enrolled Agent.
- Owner dashboard: margins, cash runway, and tax-ready KPIs.
- Secure portal, e-sign, and documented processes.
FAQs
Can both EAs and CPAs represent me before the IRS?
Yes. EAs have nationwide practice rights before the IRS. CPAs can also represent clients before the IRS; licensure is at the state level, but representation rights are recognized federally.
Which is better for tax planning—EA or CPA?
Both can be excellent. EAs specialize in tax by design; many CPAs also have deep tax expertise. Choose based on their proven process, responsiveness, and results with businesses like yours.
When do I need a tax attorney instead?
When you require legal privilege or litigation (e.g., tax court filings, criminal investigations, complex settlements). We partner with attorneys when legal strategy is necessary.
Can I keep my bookkeeper and add your EA/CPA team?
Absolutely. We coordinate with in-house or third-party bookkeepers: they handle day-to-day coding; we handle close oversight, tax, and planning.
Do you offer bookkeeping and tax under one roof?
Yes—monthly bookkeeping, quarterly planning, and annual returns—so your numbers stay clean and tax-ready year-round.
Want a quick recommendation for your situation?
Share your goals, entity, and growth plans. We’ll suggest the right mix of EA/CPA support and set a clear month–quarter–year cadence. Talk to an Enrolled Agent today. Schedule Consultation
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