If you want to advance your career by taking advantage of the many benefits of the enrolled agent designation, you should prepare to take the enrolled agent exam. It is a difficult exam that covers a wide range of enrolled agent topics. The questions can be challenging, and it’s critical to understand how to approach and interpret them correctly.
ilead is a certified enrolled agent academy in Hyderabad and provides the best training to all candidates. Here is some useful information on enrolled agent exam questions and study methods.
What is an enrolled agent exam?
The EA exam consists of three computer-based parts that cover a variety of tax-related topics. Prometric administers the exam on behalf of the IRS. It is also used to assess your tax law knowledge and skills. It contains 100 multiple-choice questions for each section.
How is the enrolled agent exam graded?
The enrolled agent exam is graded from 40 to 130. To pass, the candidate must score 105 or higher on each section.
Many candidates are successful on their first try. The pass rate for each part ranges between 60% and 90%. By studying at least 10 hours per week, you can improve your chances of success.
EA exam questions?
The Enrolled Agent exam’s multiple-choice questions (MCQs) are divided into three parts: the question stem, the best answer choice, and the distractors. The question stem is the part of the question that requests action. It contains all of the information required to answer the question. The best response option is the one that most accurately answers the question stem. Distractors are other options that appear to be correct but are not.
Types of MCQs
There are three kinds of MCQs you’ll come across:
These are the most frequently asked Enrolled Agent course exam questions. You’ll be asked a simple question and given four possible answers to choose from.
You must choose the answer that best completes the sentence when faced with this type of question.
The words NOT or EXCEPT are capitalized in these questions. When you see these words, remember to pay close attention. When you’re answering direct questions, it’s easy to become confused. The correct answer will be one that differs from the others.
Tips for answering MCQs
Now that you know what MCQs are, let’s talk about how to answer them. Our EA experts explain a few key techniques that can assist you in selecting the best answer option.
- Carefully read the question steam
Many candidates make the mistake of only reading the answer choices and skimming over it. This can lead to confusion and the selection of the incorrect answer. Read the question stem first to determine exactly what the question is asking so that you aren’t distracted by any extraneous information.
- Eliminate answer choice
Because the Enrolled Agent exam is a multiple-choice exam, there is always only one correct answer. If you can eliminate even one distractor, your chances of correctly guessing the answer increase significantly. Mostly, don’t skip the questions and try to guess the correct answers.
- Make an educated guess
Make an educated guess if you’re stuck between two answers and can’t rule out either. Narrow your options, then select the answer that appears to be the most logical.
- Take your time
There’s no need to rush because you have three and a half hours to complete each part of the Enrolled Agent exam. Read each question carefully and answer each one in an average of 1.5 minutes. If you don’t know the answer to a question, make an educated guess and mark it for later review.
- Attempt every question
Your Enrolled Agent exam score is entirely determined by the number of correct answers you provide. That is, you will not be penalized if you answer incorrectly. When taking this test, you should avoid skipping questions. Random guesses have a 25% chance of being correct.
Now, let’s talk about how to study for the exam.
Part 1: Individuals
This section discusses filing status, dependents, gross income, income adjustments, itemized deductions, and tax credits. You’ll also be quizzed on self-employment taxes and retirement plans.
Part 2: Businesses
This section includes information on business entity types, income, expenses, assets, liabilities, and tax credits. You must demonstrate your understanding of payroll taxes and information returns.
Begin by reviewing IRS resources such as Publication 15 (Circular E), which discusses employer responsibilities for withholding, depositing, and paying employment taxes.
Part 3: Representation, Practices & Procedures
This section assesses your understanding of Circular 230 rules, IRS practice and procedure, and ethics. Review Circular 230 and the IRS Enrolled Agent exam study materials to prepare for this section. You should also brush up on your professional ethics and standards knowledge.
Joining the best-enrolled agent training institute in Hyderabad like iLead Tax Academy is the simplest way to ensure you’re ready to pass your EA exam. We provide a comprehensive Enrolled Agent course that covers all three exam sections and has been assisting candidates in obtaining their EAs for decades. Our system includes audio lectures, textbooks, practice quizzes, simulated exams, and the most comprehensive MCQ test bank. Join iLead Tax Academy and begin your journey to becoming an Enrolled Agent.