Key Takeaways
- EAs can request inactive status if not practicing.
- Inactive status suspends CE requirements but bars representation.
- Failure to renew results in enrollment expiration.
- Termination can occur for noncompliance or disciplinary action.
- Reinstatement requires meeting CE requirements and reapplying.
- Voluntary surrender of enrollment is also an option.
Inactive Status & Termination
Why This Matters for the Exam
Not all EAs practice continuously. The exam tests whether you understand inactive status, how enrollment can be terminated, and how to reinstate.
Expect at least 2-3 questions on inactive status and termination.
Inactive Status
EAs who are not currently practicing may request inactive status.
| Aspect | Detail |
|---|---|
| Who can request | EAs not currently practicing |
| Effect on CE | CE requirements suspended |
| Effect on enrollment | Enrollment not terminated |
| Representation | Cannot represent clients |
| EA designation | Cannot hold yourself out as active EA |
Benefits of Inactive Status
| Benefit | Description |
|---|---|
| CE suspended | No CE required while inactive |
| Enrollment preserved | Don't have to retake SEE |
| Reactivation available | Can return to active status |
Limitations of Inactive Status
| Limitation | Description |
|---|---|
| No representation | Cannot practice before IRS |
| No advertising | Cannot advertise as "Enrolled Agent" |
| No signing returns | Cannot sign as paid preparer |
Reactivation from Inactive Status
To return to active status:
| Requirement | Detail |
|---|---|
| CE makeup | Complete CE for the period of inactivity |
| Form 8554 | Submit with reactivation request |
| Fee | $140 renewal fee |
| PTIN | Must be active |
Enrollment Termination
Enrollment can be terminated for several reasons:
| Reason | Description |
|---|---|
| Failure to renew | Enrollment expires if Form 8554 not submitted |
| Disciplinary action | OPR sanctions (suspension, disbarment) |
| Voluntary surrender | EA voluntarily gives up enrollment |
| Death | Enrollment terminates upon death |
Termination vs. Expiration vs. Inactive
| Status | CE Required? | Can Practice? | Enrollment Intact? |
|---|---|---|---|
| Active | Yes | Yes | Yes |
| Inactive | No | No | Yes |
| Expired | N/A | No | No |
| Terminated (OPR) | N/A | No | No |
Reinstatement After Expiration
If your enrollment expires due to failure to renew:
| Step | Requirement |
|---|---|
| 1 | Complete all CE that would have been required |
| 2 | Submit Form 8554 with $140 fee |
| 3 | Pass tax compliance and background check |
| 4 | May require retaking SEE in some cases |
Key Point: Reinstatement is not guaranteed. The longer you wait, the more difficult it becomes.
Reinstatement After OPR Sanction
If your enrollment was terminated by OPR (suspension/disbarment):
| Sanction | Reinstatement |
|---|---|
| Suspension | Automatic upon end of suspension period (if conditions met) |
| Disbarment | May apply after 5 years; not guaranteed |
Real-World Scenario
Scenario: You're an EA but planning to take 2 years off to care for a family member. You won't be practicing.
- Option 1: Inactive Status. Request inactive status. CE is suspended.You cannot represent clients but your enrollment is preserved. When ready to return, complete makeup CE and submit Form 8554.
- Option 2: Let it expire. Don't renew. Enrollment expires. When ready to return, must complete all missed CE and possibly retake SEE.
- Best Choice: Inactive status—preserves your enrollment with less hassle to reactivate.
On the Exam
Expect 2-3 questions on inactive status and termination, typically:
- Inactive Status Questions: "What happens to CE during inactive status?"
- Termination Questions: "What can cause enrollment termination?"
- Reinstatement Questions: "What is required to reinstate expired enrollment?"
The key is to remember: Inactive = CE suspended, no practice, enrollment preserved. Expired = must reinstate. Disbarment = 5-year wait.
What happens during inactive EA status?
What is a consequence of failing to renew EA status by the deadline?
How long must a disbarred practitioner wait before applying for reinstatement?