IRS 8867 2016 free printable template

Form Department of the Treasury Internal Revenue Service Paid Preparer s Due Diligence Checklist OMB No. 1545-1629 Earned Income Credit EIC Child Tax Credit CTC and American Opportunity Tax Credit AOTC To be completed by preparer and filed with Form 1040 1040A 1040EZ 1040NR 1040SS or 1040PR. about Form 8867 and its separate instructions is at www.irs.gov/form8867. A copy of Form 8867 2. The applicable worksheet s or your own worksheet s for any credits claimed 3. Complete this Form 8867...

How to fill out IRS 8867

How to fill out IRS 8867

1. Obtain a copy of IRS Form 8867, the Paid Preparer's Due Diligence Checklist.
2. Review the client's eligibility for the Earned Income Tax Credit (EITC) or Child Tax Credit (CTC).
3. Complete Part I by checking the boxes for each due diligence requirement that was met.
4. In Part II, provide the necessary information about the taxpayer and their dependents.
5. Fill in Part III, ensuring to answer questions regarding the taxpayer's residency, investment income, and filing status.
6. If necessary, complete Part IV to indicate if any relevant documents were provided to verify the tax benefits claimed.
7. Sign and date the form as the preparer, confirming that all information is accurate and complete.

Who needs IRS 8867?

1. Tax preparers who prepare tax returns claiming the Earned Income Tax Credit (EITC) or Child Tax Credit (CTC).
2. Any professional who provides tax preparation services and aims to comply with IRS due diligence requirements.

• Who Needs IRS Form 8867?
• What is the Purpose of Form 8867?
• Is Form 8867 Accompanied by any Other Documents?
• • When is Form 8867 Due?
  • How do I Fill out Form 8867?
  • Where do I Send Form 8867?

Who Needs IRS Form 8867?

This document is the IRS form fully called Paid Preparer's Earned Income Credit Checklist. It is to be filled out by paid tax return preparers for exercising due diligence at the moment of completing their client’s federal return or claiming a refund.

What is the Purpose of Form 8867?

The completion of the form lets the paid preparer make sure that they have exercised due diligence by interviewing their client, asking adequate questions and obtaining appropriate and sufficient information to determine the correct reporting of income, claiming tax benefits (like credits and deductions) and being compliant with the tax laws.

Is Form 8867 Accompanied by any Other Documents?

The form serves as an accompaniment to a tax return that is not filled out by a paid preparer hired by the taxpayer. Therefore, the tax preparer must fill out the Paid Preparer's Earned Income Credit Checklist and attach it to Form 1040 or its applicable version: 1040A, 1040EZ, 1040NR, 1040SS, 1040PR.

When is Form 8867 Due?

The form does not have its own due date, it must be filed with the tax return due by April 15th (if it does not fall on a federal holiday or a weekend) as one package.

How do I Fill out Form 8867?

The form is not difficult to complete. The top two lines require indicating the name of the taxpayer and the preparer’s name and PAIN (Preparer Tax Identification Number).

Otherwise, the document is a two-page form containing a list of yes/no questions about different types of credit claimed, they can be: an earned income tax credit (ETC), a child tax credit (CTC), an additional child tax credit (ACT), or an American opportunity tax credit ATC).

To help you with proper filing, the IRS has an instruction to describe the procedure step-by-step.

Where do I Send Form 8867?

The completed document must be delivered to the IRS office together with the federal return and other applicable forms.

Instructions and Help about IRS 8867

One of the most important things on the IRS competency exam is your use as a tax preparer of the Earned Income Credit, so I want to lead you guys through the form eighty-eight sixty-seven which is the paid preparers or an income credit checklist, so basically this is the form that you're supposed to fill out every time you claim the Earned Income Credit related to certain cases in most cases you have to fill this out and attach it to the tax return okay, so you can see here that this is the taxpayers name social security number, so you're verifying these taxpayers' eligibility to receive their Earned Income Credit look here on the front of the form where it actually has the preparers name and PAIN on the eighty-eight sixty-seven okay that's a major factor as a preparer IRS statistics show that up to 40 percent of audits are related to earn income credit, so IRS is really looking to find out which preparers are submitting the most earned income credits that don't actually meet the criteria okay so important thing to realize right there as a tax preparer you have to identify this is the taxpayers filing status and married filing separately remember with earned income credit you cannot file married filing separately does the taxpayer have a social security number okay so II I see is only with the social security number for the taxpayer and also the qualifying child okay so the dependent basically also s that was social this form 2555 is for foreign income you can't actually claim the see if you are living abroad that's kind of what that's getting at on that line non-resident alien also same idea if you're not living in the U.S. you're not really eligible for an income credit for that year married filing jointly these are just qualification questions appear investment income more than three thousand one fifty so remember for EIC there's that disqualifying amount of investment income, so dividends could be rental property if you have more than that amount of investment income then you're not eligible to receive in or earned income credit a qualifying child of another person no okay, and you can see this form is not exactly easy to read, but it'll have the eligibility information for the first child second child third child if applicable okay, and it's trying to verify all the eligibility criteria for the Earned Income Credit, so that's relationship is number one okay and then live with the taxpayer in the US for over half the year that's that residency and then the age question so under age 19 and younger than the taxpayer so for instance younger brother can't claim an older brother for SE in most cases generally speaking under age 24 and a full-time student okay that also meets the age criteria okay, so it's basically just taking you through the various qualifying questions you can see how extensive this checklist is, and you can see by how extensive the checklist is that IRS is really attempting to have you as the tax preparer verify that person's...

People Also Ask about

What is tax form 8867 used for?

The purpose of the form is to ensure that the practitioner has considered all applicable eligibility criteria for certain tax credits for each return prepared, such as the earned income tax credit (EITC), child tax credit (CTC), additional child tax credit (ACTC), credit for other dependents (ODC), American opportunity

What is form 8867 2016?

What is the IRS form 8867? Form 8867 covers the EIC, the CTC/ACTC/ODC, the AOTC, and/or HOH filing status. You should check the boxes corresponding to all benefits actually claimed on the return that you prepared. Only paid tax return preparers should complete this form.

What are the due diligence requirements?

You cannot ignore the implications of any information given to you or known to you. You must make additional reasonable inquiries, if a reasonable and well-informed tax return preparer, knowledgeable in the law, would conclude the information furnished appears incorrect, inconsistent or incomplete.

Who needs to file form 8867?

Form 8867 must be completed by a paid tax return preparer responsible for a taxpayer's claim of the EIC, the CTC/ACTC/ODC, the AOTC, and/or HOH filing status; therefore, there may be multiple Forms 8867 for one return or amended return.

What is IRS due diligence requirement?

What is due diligence? Due diligence is a law that requires paid preparers of EITC returns to take additional steps to ensure that the return information impacting EITC eligibility is correct. Basically, due diligence requires you, as a paid preparer, to: Evaluate the information received from the client.

What are the four due diligence requirements?

Four Requirements for Due Diligence Complete Form 8867, Paid Preparer's Due Diligence Checklist, and submit it with the return. Make sure any claimed benefit is based on facts. Ask the taxpayer the right questions. Keep records for three years.

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What is IRS 8867?

IRS Form 8867, also known as the 'Paid Preparer's Due Diligence Checklist,' is a form used by tax preparers to ensure they fulfill due diligence requirements when claiming certain tax credits, primarily the Earned Income Tax Credit (EITC).

Who is required to file IRS 8867?

Any tax preparer who files a tax return claiming the Earned Income Tax Credit (EITC), the Child Tax Credit (CTC), the American Opportunity Tax Credit (AOTC), or the Head of Household filing status must complete and attach Form 8867 to the return.

How to fill out IRS 8867?

To fill out IRS Form 8867, preparers must provide information regarding their efforts to verify eligibility for the credits claimed, confirm the taxpayer’s identity, and document the required due diligence steps taken during the preparation of the return.

What is the purpose of IRS 8867?

The purpose of IRS Form 8867 is to ensure that paid tax preparers take reasonable steps to evaluate their clients' eligibility for refundable tax credits and to document their due diligence efforts.

What information must be reported on IRS 8867?

Form 8867 requires the reporting of information such as taxpayer eligibility criteria for the credits claimed, the preparer's due diligence steps taken, and any required supporting documents or information pertaining to the credits.