What a CPA actually is
CPA is a state license, earned through a rigorous exam, education requirements and ongoing continuing education. It's the broadest credential in US accounting — covering tax, audit, and financial reporting — and CPAs have unlimited representation rights before the IRS.
CPA vs EA vs "tax preparer"
- CPA — state-licensed, broad scope including audits and financial statements
- EA — federally licensed, tax-specialized, same unlimited IRS representation
- Unlicensed preparer — can fill in forms, but has limited or no representation rights when the IRS asks questions
Why it matters for you
When a CPA signs your return, a license stands behind it. If the IRS sends a notice, a CPA can respond, negotiate and represent you fully — an unlicensed preparer often can't. For business owners, CPA-reviewed books also carry weight with banks and investors.
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