IRS gets tough on preparers who avoid Form 8867

[FEDUKE404]

Never mind,

[ATSMAN]

Are they paper filing? I have e-filed 99.9% of my returns thus far. One return paper filed because it got a reject that could not be cured because one child was claimed by ex-spouse and this was not his year to claim the child!

[ATSMAN]

Well, they are supposed to be efiling. . .
But the Form 8867 has nothing to do with efiling, so my guess is that it is perhaps possible for the IRS to take longer to "notice" selected deficiencies in 2018 tax returns not being e-filed.
However, since the Due Diligence form now addresses EITC and CTC and AOTC and even HOH filing status. . .there are a lot of places the IRS folks (computers) can pick up on non-compliance.

NOTE: I was unable to find online the 02/28/2019 update of Letter 5364. Maybe it will eventually show up somewhere.

FE

I believe every professional tax prep software has to go through testing by IRS and state revenue dept before it is approved for e-filing and this ensures that the required forms such as Form 8867 will be included in the e-file. My software will NOT even allow me to go to step 1 of e-filing if the questions on the 8867 is not answered. I have a suspicion that some kitchen table preparers are using TT or other end user software and mailing the returns as "self prepared". Today a girl showed up at my office with a 2017 tax return copy marked "self-prepared" but she paid a preparer $100 to prepare it! This idi*t even put his name on a manila folder and had $10 coupons for referrals.

[kathyc2]

Good for them! What's the point of having a requirement if it's not enforced? There are a LOT of areas I wish IRS was tougher on, starting with hobby losses and reasonable salary.

[ATSMAN]

Good for them! What's the point of having a requirement if it's not enforced? There are a LOT of areas I wish IRS was tougher on, starting with hobby losses and reasonable salary.

It is really the Congress's fault for not writing good tax law IMHO. For Hobby income and expenses, do we even know how to treat expenses now that misc. deductions subject to 2% haircut is lost? Why is it fair to deduct cost of goods sold from gross hobby income, but not other expenses if CG is not involved in that particular hobby. They could have legislated that 80% (or some other reasonable) of expenses is a deduction against gross income with net hobby income no lower than 0 and no NOL.

[RWG1950]

Is the form 8867 required to be printed and submitted to IRS, SEPARATE FROM & IN ADDITION TO to the e-filed return ?
I do very few ed. credit returns and have always thought the on-screen 8867 I fill in, goes to IRS as part of the e-filed return.
If this is not so, & we're required to mail this in, what transmittal form would be used to remit the paper 8867 ?

[kathyc2]

CPA's, unlike others are regulated by the state. If you have documentation of what you describe, consider informing the state agency. The rest of us should not have our designation sullied by the unethical ones.

[ATSMAN]

I am really surprised that so many accountants including CPAs use personal tax software to bypass the rules and file as self prepared knowing full well that IRS can censure them if they get caught doing this BS! Why not use professional tax software on a pay per return basis if the volume does not justify getting an unlimited version. Even the TaxAct professional bundle is affordable for a small volume CPA!