[Jay]

So… I started my CPA journey maybe 3 or 4 years ago and I just cant seem to stay on it long enough or hard enough to pass all 4 in the window. I Passed Reg first, then a year later passed BEC, got close to passing AUD and failed maybe 15 Exams all together.

I keep asking myself why I want the CPA and honestly, the answer I keep ending up with is Prestige and the people around me want me to get it BUT the more I look into it, the more I can’t seem to find the value.

I work in Tax doing all thing Personal and Business Tax Returns at a small CPA office and I make roughly 100k in NYC, which isn’t bad but isn’t amazing either. Recently, Iv’e been looking at the EA certification and the differences between the CPA and EA and, correct me if i’m mistaking, but it looks like the EA is a bit better as its a federal cert as opposed to a state one. The only think I think I need out of either certification is to become POA for clients and speak on their behalf. I really feel like I quit going for the CPA sometime last year and I don’t see myself getting back into it unless I feel like it would be incredibly beneficial to my career and growth but if I stay in Tax do I need the CPA? Also, i really only want to make an additional 40k to 80k a year and the only way I could do that is by having clients a few clients of my own, maybe 10 – 13. How difficult would it be to get my first few clients as an EA since people don’t usually know what that is? Also, just your opinion because i’m at a loss for myself, does this sound right to you? Am i wrong for not wanting the CPA anymore? Could I do both, continue working at my job and handling 10 – 13 clients on the side?

I appreciate any feedback. Thanks!

REG 82 (08/08/15)

[TommyTheCat]

Hi Jay, I think I know where you are coming from. I have been in meetings bidding on many client projects against other firms and the client often times wants to go with the one that is a CPA or the firm that has the most CPAs that will be involved on their projects.

I've been in tax only for the past 12 years and have had zero issues with not being a CPA until recently. For me getting the CPA versus the EA is needed in order to have better success rate getting new clients in the door, and also my firm requires you to be a CPA before you can get promoted to partner. Where I am at with my career I am knocking at the door for partner, the only things keeping me from it are the aforementioned CPA license requirement and the fact that I need to have a more robust book of business built up.

If I weren't trying to make partner and was OK with a book of business of a few hundred thousand I'd stay put as is and you'd be comfortable in this position I am in from the parameters you laid out in your post.

So with all that said, I think you are right going the EA route for now. Then if you aren't happy with where your earnings or book of business stands you can always kick back into the CPA mode down the road.

What you think?

[Recked]

Get the EA in your pocket. It will give you something after your name, and perhaps you will learn a little better on how to study efficiently, etc.
A little confidence boost. Once you knock out the EA you might find yourself a little more focused and motivated to try the CPA again.

I had the EA, but ultimately needed CPA to push for equity/partner status.
One day at a time my friend. All good things in their due course. Get the EA and then rethink your whole situation.
I can almost guarantee that one day you will wish you had followed through on the CPA, but cover your bases in the mean time.
I used Gleim for the EA, highly recommend their course. I was over-prepared for sure.

[turo9992000]

I work at at tax office as well, and clients do not know what an EA is. They hear enrolled agent and they don't care. You are right that an EA can represent clients in all states. The only people I've spoken to who are more impressed by the EA designation rather than the CPA are IRS agents. Also CPAs bill more. I got my EA for the Power of Attorney, but I never added it to my business cards. I wanted the CPA and I kept working until I passed. You could look at my profile and see that I took 7 years from graduation to passing all four it's doable if you want it.

In terms of an achievement though, I don't put much weight on the EA. I was able to pass the EA exam in 3 Saturdays and I only studied MCQs during my lunch breaks. I was also studying for the REG exam at nights at the time.

What type of work are you doing for the clients on the side? That's what I would try to eliminate. You could also start building your book of business and try to integrate them into your firm.

I only passed the CPA exam after I started spending about 25 hours per week studying for it. 6 weeks for most 8 weeks for FAR.

[Jay]

@TommyTheCat I appreciate the thoughtful response. I like what you said and it makes sense. I think looking at you I can say confidently that you CAN get a lot of clients as an EA but it may be a little more difficult. I don't have a Book of Business currently because I don't have a certification and always postponed getting my own clients. I never really wanted a robust book of business like it seems you have. My goals are pretty simple, make enough enough to buy a Condo for something around 800k – 1mil and buy a GTR but maybe that's because i'm only 26. 1 question, why do you want to become partner and make all that money? Is there something you need the money for or is it just to say that you are a partner of a successful CPA firm?

@Recked Based on both your replies I definetely will get my EA and not postpone it anymore. Both of you got the EA and became successful and only afterward went towards your CPA. Looking at the forum, you would assume everyone is 1 track mind geared towards the CPA. I appreciate the response and I don't know if i'll regret not getting my CPA in 10 years but I can see how it's a possibility.

REG 82 (08/08/15)

[Jay]

@Turo9992000 Currently I don't do any work on the side for clients except for a personal return as a favor and an inactive corporation filing. I don't want to take on clients without at least an EA and also I think deep down I just wanted more lounging around time for myself. I work at a small office where the conversation of bringing my own clients never even came up. Could you explain how that works where you work? Do you bring in clients and use the Company Header and resources including staff and give a % to the company of your billings? How would one broach the topic without coming off as wanting to start my own practice and leaving years down the road?

REG 82 (08/08/15)

[Recked]

The idea of making partner is 2 fold. 1, you work and make money for yourself, vs making money for someone else 2, you build a book of business, a bankable asset that you can then sell to help fund your retirement.
A typical CPA practice does roughly 1/3 to overhead, 1/3 to wages and 1/3 of gross goes to the partners. If you aren't making money for yourself then you are making money for someone else.
The year before the CPA exam I billed out more than 50% of the work at my office, and my total cost to the firm was less than 25% of gross, and actual comp package was even less than that.
Just to set the record straight, I did not obtain the EA instead of the CPA basedon desire. I did not have the credits for the CPA and the MBA from my local university was over $30k. I got the EA to increase my billing rate (and compensation) while I waited to become eligible to sit for the CPA.
***
I honestly think once you pass the EA exams you will feel ready to take on the CPA exams again. 25 hours a week worked for me.

[alloverit]

This is a really interesting thread.

Since you're in NYC that changes things some.

But interesting story, as a small town (35,000 population) accountant I actually had a CPA (not at my firm) tell me that he wouldn't allow anyone to work at his firm if they had the EA. His reason? The term “enrolled agent” could give the impression that he had employees who were associated with the IRS and it might be bad for business.

This sounds absurd I know, but I just wanted to share.

And one other thing, there is ZERO doubt in my mind that most CPAs look down on the EA. I personally respect the person…the best tax guru I ever met was an EA only. But I'm not sure that's how most other CPAs think.

[Jay]

@Alloverit Woah, I never thought about the correlation of EA and IRS in a clients perspective of you. That's interesting. I can tell you 100% that CPA's do look down on EA's. I know because I have in the past (even though i'm not a CPA). That's when I first started for a year or 2 but then I started seeing some terrible returns prepared by CPA's and you realize, no title will make you good and no certification makes you better than the next guy. It's all experience.

REG 82 (08/08/15)

[Author]

Replies