What is ERO or EFIN?

 In the world of tax preparation, professionals often come across terms like ERO and EFIN. But what is ERO or EFIN, and why are they important? At L&Y Tax Advisor, we believe in empowering our clients and partners with the knowledge they need to navigate the tax industry confidently.

Understanding ERO and EFIN

What is an ERO?

ERO stands for Electronic Return Originator. This is an individual or organization authorized by the IRS to submit tax returns electronically. EROs are a vital part of the e-file system and typically include:

  • Certified tax preparers

  • Accounting firms

  • Tax service franchises

Being an ERO means you're responsible for reviewing and filing returns on behalf of your clients through the IRS e-file system.

What is an EFIN?

EFIN stands for Electronic Filing Identification Number. It is a unique number issued by the IRS to individuals or firms who have been approved as authorized e-file providers.

To obtain an EFIN, tax professionals must:

  • Apply through the IRS website

  • Undergo a background check

  • Meet IRS compliance requirements

At L&Y Tax Advisor, we help new tax preparers get started with the EFIN application process to ensure full IRS compliance from day one.

Why Are ERO and EFIN Important?

  • Trust and credibility: They establish your legitimacy as a tax professional.

  • Faster filing: They allow for quicker processing of tax returns.

  • IRS compliance: Mandatory for professionals who want to e-file on behalf of clients.

  • Client convenience: Clients receive refunds faster with e-filed returns.

Partner with L&Y Tax Advisor

Whether you're starting your own tax business or looking to expand, L&Y Tax Advisor provides expert support and training for EROs and assistance in obtaining your EFIN.

FAQs

Q: Do I need both an ERO and EFIN to file taxes for clients?
 A: Yes. An ERO is your role, and the EFIN is the number the IRS gives you to perform that role.

Q: How long does it take to get an EFIN?
 A: The process can take up to 45 days, so it’s best to apply early.

Q: Can I use someone else’s EFIN?
 A: No. Each tax preparer must have their own EFIN or operate under an approved firm’s EFIN.

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