Active vs. Inactive CPAs

What's the difference?

Updated Jan. 2, 2014

CPAs often have many questions when they consider active or inactive status. Use this chart to compare the costs, effort, benefits and disadvantages of being an active or inactive CPA in Minnesota.

  Active Status  Inactive Status 
Required status 
  • CPAs who prepare tax returns for a public accounting firm with a CPA firm permit
  • CPAs who issue compilation reports other than through a CPA firm
  • CPAs employed by the Office of the Legislative Auditor or State Auditor

See BOA rule 1105.2500 

  • Sufficient if preparing a small number of returns each year
 
Cost 
  • $100 annually
  • MNCPA dues are not determined by certificate status
  • $25 annually
  • MNCPA dues are not determined by certificate status
 
Requirements 
  • Annual minimum of 20 CPE credits
  • 120 CPE credits every 3 years, including 8 hours of ethics
  • Maintain records of completed CPE credits
  • CPE courses must comply with BOA rules
  • Renew CPA certificate and report CPE based on BOA rules
  • State 'inactive' when using CPA credential (example: Joe Smith, CPA Inactive)
  • Renew CPA certificate based on BOA rules
  • No CPE credits required
  • Must return to active status to use CPA without 'inactive' modifier

View steps to convert to active 

Advantages 
  • Display the credential as evidence your professional background
  • Exhibit strong technical, personal and ethical skills
  • Mitigate risk for your clients or company with current knowledge of regulations and trends
  • Increase your marketability and job opportunities. Salary can increase as much as 10% when the credential is active.
  • Safeguard yourself to use 'CPA' in other states, as active certificate is more substantially equivalent
 
  • No required educational costs
  • No restrictions on format or topic of educational programs you choose to attend, such as company-led training
 
Disadvantages 
  • Increased costs to maintain CPA certificate
  • Time away from office necessary to attend CPE courses
 
  • Public confusion over validity of CPA credential when 'inactive' modifier is used
  • Potentially outdated skills or management practices due to lack of training
  • May not be eligible to use 'CPA, Inactive' in other states with no substantial equivalency
 

Questions?

The MNCPA does not manage CPA certificates in Minnesota. For specific information regarding CPA certificates, contact the Minnesota Board of Accountancy.