Your FREE Enrolled Agent Flashcards 2026 – 250+ Cards

A federally authorized tax practitioner empowered by the U.S. Treasury with unlimited rights to represent any taxpayer before the IRS on any tax matter.

The 3-part IRS exam — Individuals, Businesses, and Representation — passed to become an enrolled agent.

Total income minus above-the-line adjustments (e.g., deductible IRA, student-loan interest, ½ of SE tax).

An adjustment subtracted from total income to reach AGI, available whether or not the taxpayer itemizes.

$15,750 for single and married filing separately filers.

$31,500 for married filing jointly and qualifying surviving spouses.

$23,625 for head of household filers.

$1,600 each for age 65+ or blind; $2,000 if unmarried and not a surviving spouse.

Single, Married Filing Jointly, Married Filing Separately, Head of Household, Qualifying Surviving Spouse.

On the last day of the tax year (December 31 for calendar-year taxpayers).

Be unmarried (or considered unmarried), pay more than half the cost of keeping up a home, and have a qualifying person live with you more than half the year.

A status for the two years after a spouse's death for a taxpayer with a dependent child; uses MFJ rates and the $31,500 standard deduction.

A still-married taxpayer who lived apart from the spouse the last 6 months of the year and kept up a home for a qualifying child may file head of household.

Relationship, age, residency, support, and joint-return tests.

Not a qualifying child, relationship/member-of-household, gross-income, and support tests.

Individual Taxpayer Identification Number — issued to taxpayers who must file but are not eligible for a Social Security number.

A deduction reduces taxable income (value depends on the bracket); a credit reduces tax dollar-for-dollar.

A credit (e.g., EITC, Additional Child Tax Credit) that can produce a refund even when it exceeds tax owed.

A credit that can reduce tax only to zero; any excess is lost (some carry forward).

Up to $2,200 per qualifying child under age 17; up to $1,700 refundable as the Additional Child Tax Credit.

A $500 nonrefundable credit for dependents who don't qualify for the Child Tax Credit.

Begins at modified AGI of $400,000 (MFJ) or $200,000 (all others), reduced $50 per $1,000 over.

A refundable credit for low-to-moderate-income workers, larger with more qualifying children; a top preparer due-diligence area.

$649 (0 children), $4,328 (1), $7,152 (2), $8,046 (3 or more).

$11,950 — exceed it and the EITC is disallowed.

Up to $2,500 per student for the first 4 years of college; 40% refundable (up to $1,000).

Up to $2,000 per return for any years of higher education or job-skill courses; entirely nonrefundable.

Not for the same student in the same year; choose one per student.

MAGI $80,000–$90,000 (single) and $160,000–$180,000 (MFJ) for both AOTC and LLC.

Medical over 7.5% of AGI, state and local taxes (capped at $40,000 for 2025), mortgage interest, and charitable gifts.

For 2025 (OBBBA) state and local taxes are capped at $40,000 ($20,000 if married filing separately) as an itemized deduction, phasing down for MAGI over $500,000 but never below $10,000; reverts to $10,000 after 2029.

Only medical expenses exceeding 7.5%% of AGI are deductible on Schedule A.

Profit on the sale of a capital asset: amount realized minus basis.

A taxpayer's investment in property — usually cost plus improvements — used to figure gain or loss.

More than one year = long-term (preferential rates); one year or less = short-term (ordinary rates).

0%%, 15%%, or 20%% depending on taxable income — generally lower than ordinary rates.

Taxable income up to $48,350 (single) or $96,700 (MFJ) is taxed at the 0% long-term rate.

Net capital losses offset up to $3,000 of ordinary income per year ($1,500 MFS); the rest carries forward.

Excludes up to $250,000 ($500,000 MFJ) of gain on a main home meeting the 2-of-5-year ownership and use test.

15.3%% on net SE earnings (12.4%% Social Security up to the wage base + 2.9%% Medicare); half is deductible above the line.

A 3.8%% tax on net investment income above modified-AGI thresholds for higher-income taxpayers.

A 0.9% tax on wages and self-employment income above a threshold ($200,000 single / $250,000 MFJ).

A parallel tax (26%%/28%%) that recaptures the benefit of certain deductions and preferences.

A child's unearned income above a threshold is taxed at the parent's marginal rate.

A 10%% additional tax generally applies to retirement distributions before age 59½, with exceptions.

The minimum a retirement account owner must withdraw each year beginning at the applicable RMD age.

Traditional IRA contributions may be deductible and distributions taxable; Roth contributions are after-tax and qualified distributions are tax-free.

Tax-free if taken after age 59½ (or other trigger) and the 5-year holding period is met.

The U.S. individual income tax return.

The amended individual income tax return.

Not deductible by the payer and not taxable to the recipient for agreements executed after 2018.

Deductible by the payer and taxable to the recipient for agreements executed before 2019.

In community-property states, income earned during marriage is split 50/50 between spouses — important for MFS returns.

Relief from joint tax liability for an understatement caused by the other spouse that the requesting spouse didn't know about.

Form 8379 — protects one spouse's refund share from being applied to the other spouse's separate debt.

$19,000 per donee; gifts above it are reported on Form 709 and use the lifetime exemption.

Married donors can elect to treat gifts as made half by each spouse, doubling the annual exclusion.

The United States gift (and generation-skipping transfer) tax return.

The estate tax return, filed for estates above the lifetime exemption.

Report of foreign bank and financial accounts, filed with FinCEN — separate from the IRS Form 8938.

Statement of specified foreign financial assets, filed with the income tax return (different thresholds than the FBAR).

A refundable credit that helps pay marketplace health-insurance premiums, reconciled on Form 8962.

Forgiven debt is generally taxable income unless an exclusion (e.g., insolvency, bankruptcy) applies.

Two methods to deduct vehicle costs; the standard mileage rate is set annually per business mile.

Quarterly payments required when withholding won't cover the tax, to avoid an underpayment penalty.

The greater of $1,350 or earned income plus $450 (not exceeding the regular standard deduction).

The Paid Preparer's Due Diligence Checklist required for EITC, CTC/ODC, AOTC, and head-of-household claims.

Compensation reported on Form W-2; fully includible in gross income.

Interest from banks, bonds, and most sources is taxable; reported on Schedule B if over a threshold.

Municipal-bond interest is generally exempt from federal income tax but still reported.

Dividends taxed at the preferential long-term capital-gains rates if holding-period rules are met.

Dividends taxed at ordinary income rates.

Up to 85%% of benefits may be taxable depending on the taxpayer's combined income.

Fully taxable as ordinary income.

Winnings are fully taxable; losses are deductible only if itemizing and only up to winnings.

Lets eligible taxpayers with a high-deductible plan make pre-tax contributions and take tax-free qualified medical withdrawals.

A nonrefundable credit for lower-income taxpayers who contribute to a retirement account.

A credit for work-related care expenses for a qualifying child under 13 or a disabled dependent.

A nonrefundable credit for qualified adoption expenses, subject to a dollar limit and phaseout.

A taxpayer takes the greater of the standard deduction or total itemized deductions.

Interest, dividends, capital gains, rents, and royalties — the base for the 3.8%% NIIT.

Reports nondeductible IRA contributions and basis to keep that portion from being taxed again on distribution.

An IRA owner 70½ or older can exclude from income amounts transferred directly to charity, up to an annual limit.

An above-the-line deduction of up to $2,500 of student-loan interest, subject to a MAGI phaseout.

An above-the-line deduction for eligible K-12 educators' classroom expenses, up to an annual cap.

Disallows a loss on a security sold and repurchased (or substantially identical) within 30 days before or after.

Avoid the underpayment penalty by paying 90%% of the current year or 100%% (110%% for higher income) of the prior year's tax.

If one spouse itemizes on an MFS return, the other spouse must also itemize (can't take the standard deduction).

Advance payments of the PTC are reconciled on Form 8962, which can increase or decrease the refund.

Most property held for personal use or investment; key exceptions include inventory and business receivables.

An unincorporated one-owner business reported on Schedule C; income is subject to income and self-employment tax.

The form a sole proprietor uses to report business profit or loss on the individual return.

A pass-through entity filing Form 1065 that reports each partner's share on Schedule K-1.

The U.S. return of partnership income — informational; the partnership itself pays no income tax.

A pass-through corporation (Form 1120-S + K-1) limited to 100 eligible shareholders and one class of stock.

The income tax return for an S corporation; income flows through to shareholders on Schedule K-1.

A corporation taxed separately at a flat 21%% rate; its dividends are taxed again to shareholders (double taxation).

The U.S. corporation income tax return for a C corporation.

A flat 21%% federal corporate income tax rate.

C corporation profits are taxed at the entity level (21%%), then again as dividends to shareholders.

A business (sole prop, partnership, S corp) whose income is taxed to the owners rather than the entity.

Reports each owner's share of a pass-through entity's income, deductions, and credits.

The election by which an eligible corporation becomes an S corporation.

The entity classification election (check-the-box) by which an eligible entity chooses its tax treatment.

No more than 100 eligible shareholders (generally U.S. individuals), one class of stock, and a timely Form 2553 election.

A partner's investment in the partnership; it limits deductible losses and includes a share of partnership liabilities.

Limits deductible losses; unlike a partner, an S-corp shareholder's basis does not include entity-level debt (only direct loans).

A distribution greater than the owner's basis is taxable as capital gain.

A fixed payment to a partner for services or capital — deductible by the partnership and generally subject to self-employment tax.

Allows tax-free transfer of property to a corporation in exchange for stock when the transferors control 80%% after.

A corporate tax measure that determines how much of a distribution is a taxable dividend.

A deduction that lets a C corporation exclude part of dividends received from other corporations to limit triple taxation.

A penalty tax on a C corporation that retains earnings beyond reasonable business needs to avoid shareholder tax.

Beginning inventory plus purchases minus ending inventory; subtracted from gross receipts to get gross profit.

Uniform capitalization rules requiring certain direct and indirect costs to be capitalized into inventory.

The deduction that spreads the cost of business property over its useful life.

The Modified Accelerated Cost Recovery System — the standard depreciation method with set class lives.

An election to deduct the cost of qualifying business property immediately, up to an annual cap; limited to business income (can't create a loss).

An additional first-year deduction of a percentage of qualifying property's cost; unlike §179, it can create a loss.

Apply Section 179 first (up to business income), then bonus depreciation on the remaining basis.

Section 199A deduction of up to 20%% of qualified business income for eligible pass-through owners.

Limitations phase in above taxable income of $197,300 (single) and $394,600 (MFJ).

Fields like health, law, accounting, and consulting; the QBI deduction phases out and is lost above the upper threshold.

A loss exceeding income; carried forward to offset up to 80%% of future taxable income.

The application to change an accounting method.

Cash recognizes income when received and expenses when paid; accrual recognizes when earned/incurred.

Reconciles book income to taxable income on a business return — a frequent exam topic.

Allowed for space used regularly and exclusively as a principal place of business; simplified or actual-expense method.

Employee vs. independent contractor, judged on behavioral control, financial control, and the relationship.

Reports nonemployee compensation of $600 or more to a contractor.

Reports cash payments over $10,000 received in a trade or business.

Form 1041 — reports the income of an estate or trust.

Limits and characterizes the income an estate or trust deducts for distributions and passes to beneficiaries on K-1.

Applies on Form 1023/1024 and files Form 990 annually; may owe tax on unrelated business income.

The annual information return filed by most tax-exempt organizations.

Tax on income an exempt organization earns from a trade or business unrelated to its exempt purpose (Form 990-T).

A simplified employee pension plan letting employers make tax-deductible retirement contributions for employees.

A retirement plan for small employers with employee deferrals and required employer contributions.

An improper dealing between a retirement plan and a disqualified person that triggers excise tax.

The form farmers use to report farm income and expenses.

Losses from passive activities (e.g., most rentals) are deductible only against passive income, with limited exceptions.

Active participants can deduct up to $25,000 of rental real-estate losses against other income, phased out as MAGI rises above $100,000.

A taxpayer meeting material-participation and hours tests whose rental activities are not automatically passive.

Defers gain on the exchange of real property held for business or investment for like-kind real property.

Gain attributable to prior depreciation is taxed at ordinary or special rates rather than capital-gain rates.

C corporations generally pay estimated tax in quarterly installments to avoid an underpayment penalty.

Employer Identification Number — the federal tax ID for a business entity.

S-corp owner-employees must be paid reasonable wages before taking distributions, to prevent avoiding payroll tax.

A corporate-level tax on a former C corporation's appreciated assets sold within a recognition period after the S election.

Net earnings from self-employment (generally 92.35%% of net profit) are subject to SE tax.

Schedule K summarizes partnership items; each K-1 reports one partner's distributive share.

Distributions in liquidation generally are tax-free to the extent of basis, with gain only above basis.

An S election ends by revocation, ceasing to qualify, or excess passive income for 3 years with E&P.

A liquidating corporation generally recognizes gain/loss as if it sold its assets at fair market value.

Depreciable personal property; gain up to prior depreciation is recaptured as ordinary income.

Depreciable real property; unrecaptured §1250 gain is taxed at a maximum 25%% rate.

Depreciable business property held over a year; net gains are capital, net losses are ordinary.

Up to $5,000 deductible in year one (phased out over $50,000), the rest amortized over 180 months.

Up to $5,000 deductible in year one, the remainder amortized over 180 months.

Owners pay estimated tax on their share of pass-through income via their individual returns.

The employer's annual Federal Unemployment Tax (FUTA) return.

The employer's quarterly return reporting withheld income tax and Social Security/Medicare.

An employee-reimbursement arrangement that, if business-connected and substantiated, is not taxable wages.

Methods include FIFO, LIFO, and specific identification; the method affects COGS and taxable income.

An activity not engaged in for profit can't deduct losses; the profit-presumption test helps distinguish a business.

Limit deductible losses to the amount the taxpayer has economically at risk in the activity.

Deductible up to 10%% of taxable income, with a 5-year carryover of the excess.

The application to adopt, change, or retain a tax year.

A business may use a fiscal year (ending other than December 31) if it qualifies and elects properly.

S-corp distributions are generally tax-free return of basis; C-corp distributions are dividends to the extent of E&P.

Regular, continuous, and substantial involvement that makes an activity nonpassive (seven tests).

Business bad debts are deductible as ordinary losses; nonbusiness bad debts are short-term capital losses.

Reports depreciation and amortization, including Section 179 and bonus depreciation.

A self-employed person may deduct health-insurance premiums above the line, limited to business income.

Treasury Department regulations (31 CFR Part 10) governing practice before the IRS — duties, standards, and sanctions.

Attorneys, CPAs, enrolled agents, enrolled retirement plan agents, enrolled actuaries, and (limited) tax return preparers.

Enrolled agents, CPAs, and attorneys can represent any taxpayer on any matter before any IRS office.

The IRS office with exclusive authority to enforce Circular 230 and discipline practitioners.

Censure (public reprimand), suspension (1–59 months), disbarment (5+ years), and monetary penalty (up to 100%% of gross income from the conduct).

A public reprimand under Circular 230; the practitioner may continue to practice.

A Circular 230 sanction barring practice before the IRS for 1 to 59 months.

A Circular 230 sanction revoking practice rights; reinstatement may be petitioned only after at least 5 years.

A practitioner must promptly advise a client of any known error, omission, or noncompliance.

A practitioner must exercise due diligence as to the accuracy of returns and representations to the IRS.

A practitioner may not charge an unconscionable fee; contingent fees are restricted to limited situations.

A practitioner must promptly return a client's records on request — even in a fee dispute.

A practitioner must not represent conflicting interests absent informed written consent from each client.

Generally only for an IRS examination/challenge of an original return, a refund claim related to penalties/interest, or judicial proceedings.

Preparer Tax Identification Number — required for every paid preparer (including EAs) and renewed annually.

72 hours every 3-year cycle (including 6 hours of ethics), with a minimum of 16 hours per year (2 ethics).

Enrolled agents renew enrollment every 3 years on Form 8554, staggered by the last digit of the SSN.

The application for enrollment to become an enrolled agent, filed within 1 year of passing the last SEE part.

Authorizes a representative to advocate, sign certain documents, and receive confidential information before the IRS.

Lets a third party receive and inspect a taxpayer's information but grants no authority to represent.

2848 lets you represent and advocate; 8821 only lets you receive information.

The IRS database recording authorizations; it assigns each representative a CAF number.

Internal Revenue Code → Treasury regulations → revenue rulings/case law → private letter rulings and the IRM.

A written IRS determination on a specific taxpayer's facts; binding only on that taxpayer.

Generally 3 years from filing (6 years if income is understated by more than 25%%; unlimited for fraud).

Generally 10 years from assessment to collect the tax.

Correspondence (by mail), office (in an IRS office), and field (at the taxpayer's location) audits.

The report proposing audit adjustments, accompanying a 30-day letter.

Proposes adjustments and offers the taxpayer the right to appeal within the IRS Independent Office of Appeals.

The statutory notice giving 90 days to petition the U.S. Tax Court without first paying the tax.

Settles disputes based on the hazards of litigation — the last administrative chance to resolve a case.

An underreporter notice proposing changes when amounts on a return don't match third-party information returns.

A limited confidentiality privilege for tax advice between a taxpayer and a federally authorized practitioner (not for criminal or tax-shelter matters).

Generally on the taxpayer, but it can shift to the IRS if the taxpayer keeps records and cooperates.

A legal claim against a taxpayer's property for unpaid tax; the Notice of Federal Tax Lien alerts creditors.

The actual seizure of a taxpayer's property or wages to satisfy a tax debt.

Requested on Form 12153 after a lien or levy notice to dispute the collection action before Appeals.

A payment plan letting a taxpayer pay a tax debt over time in monthly amounts.

An agreement to settle a tax debt for less than the full amount when full payment is impossible or liability is doubtful.

Doubt as to collectibility, doubt as to liability, or effective tax administration.

A status that pauses collection when the taxpayer cannot pay basic living expenses and the debt.

IRS allowable-living-expense standards used to evaluate ability to pay for installment agreements and offers.

A 100%% penalty on responsible persons who willfully fail to pay over withheld employment taxes.

A process to reevaluate an audit assessment when the taxpayer has new information or didn't appear.

A claim for refund or request for abatement of certain taxes, penalties, interest, or fees.

Removal of a penalty for reasonable cause or under first-time-abatement relief.

An independent IRS organization that helps taxpayers facing hardship or unresolved problems.

The legal minimization of tax using the code's deductions, credits, and structuring.

The illegal, willful attempt to defeat tax by concealing income or falsifying records — a federal crime.

Lets a taxpayer request certain IRS records, such as their administrative or collection file.

Penalties for preparer failures, including the EITC/CTC/AOTC/HoH due-diligence penalty (Form 8867).

A penalty on a preparer for an understatement due to an unreasonable position or willful/reckless conduct.

Electronic Filing Identification Number — issued to an authorized e-file provider (ERO).

Electronic Return Originator — the authorized provider who originates the electronic submission of returns.

The taxpayer's e-file signature authorization that the ERO retains.

Explains why a return that was required to be e-filed was instead filed on paper.

Preparers who file more than a small number of covered returns must generally e-file them.

A six-digit number that prevents someone else from filing a return with a taxpayer's SSN.

Preparers must keep copies of returns or a client list, and meet data-security safeguards (e.g., a written security plan).

A preparer must use due care and cannot blindly rely on tax software for positions that lack a reasonable basis.

A penalty for filing a return taking a frivolous position or intended to delay or impede tax administration.

Communicating with the IRS on a taxpayer's behalf — preparing and filing documents, corresponding, and representing at conferences or hearings.

Aspirational standards: clear advice, acting fairly and with integrity, and clearly communicating terms of engagement.

Pass all 3 SEE parts within 3 years, or qualify through former IRS technical experience, then apply on Form 23.

A tax-compliance and background review the IRS conducts before granting enrollment.

The application for renewal of enrollment to practice as an enrolled agent.

Every paid preparer must renew the PTIN each year, generally between mid-October and December 31.

Incompetence and disreputable conduct — e.g., giving false information, conviction of certain crimes, or willful tax noncompliance.

A practitioner can be sanctioned for willfully violating Circular 230 or recklessly/grossly incompetently violating §10.34 standards.

A return-position standard — significantly higher than not frivolous but lower than substantial authority.

A position standard met when authorities supporting it are substantial relative to those against it.

A public filing that puts creditors on notice of the IRS's claim against a taxpayer's property.

A faster appeal of certain collection actions, but the decision can't go to Tax Court.

A CDP-like hearing requested after the 30-day CDP deadline, without the right to petition Tax Court.

An OIC ground used when there is a genuine dispute over whether the assessed tax is correct.

An OIC ground used when the taxpayer's assets and income are less than the full liability.

The IRS's measure of what it could collect — net asset equity plus future income — used to evaluate an OIC.

Penalty relief for a taxpayer with a clean compliance history for the prior three years.

A 20%% penalty for negligence or a substantial understatement of income tax.

5%% per month (up to 25%%) of unpaid tax for filing late.

0.5%% per month (up to 25%%) of unpaid tax for paying late.

A civil penalty of 75%% of the underpayment attributable to fraud.

The form used to request relief from joint and several liability.

Form 2848 can limit the representative to specific tax matters, forms, and years.

The unique identifier the IRS assigns a representative to track their authorizations.

Rules in Circular 230 and the IRM governing how a representative interacts with the IRS.

The §7525 privilege does not apply in criminal cases or to tax-shelter promotion.

The IRS publishes positions deemed frivolous; taking one can trigger a $5,000 penalty.

Practitioners must not knowingly assist evasion and must withdraw from improper engagements.