Economic Impact Payment Return, "Simple Return"

[Everytax]

Received a notice from Drake Software that we can start to do these Simple Returns or EIP returns. My question, Am I held to the Due Diligence Rules for these returns? If someone is claiming a child do I have to prove they have the right to claim that child? The instructions didn't say that we needed to file a 8867 , but I also don't want an audit on Due Diligence 2 years down the road and get Fined $500.00. What are your thought's?
Jerry

[spanel]

Simple returns for who? They have said now that Social Security recipients do not have to file a Simple return anymore.

Chris

[Everytax]

Low Income, VA benefits, anyone that didnt have a filing requirement or get Social Security.

[EvenKeelTax]

Hi Jerry, I also use Drake and got this notice. I plan to do the 8867 anyway. Only takes a couple minutes. Chris, the EIP returns are for people who don't get social security and who don't otherwise need to file a return. No tax return from 2018 or 2019 = no $1200 plus $500 for each dependent. I'm not planning to do many, if any, of these EIP returns since most people whom I know either file taxes or get Social Security.

[TAX4US]

Is this EIP return an actual form and can it be efiled?

[Dude]

Vitae does it for free and they don't sign the return.

[ATSMAN]

I believe the EIP returns automatically add $1 interest income to pass the IRS e-filing business rules and to get the bank info. Form 8867 is not required and I don't think it even transmits that form.

[Everytax]

From what I saw with Drake the EIP is transmitted because it says that it will have EIP marked across it so the IRS recognizes it when they receive it. I also agree that they have not mentioned the 8867, BUT you know how they make rules up after we have already started to do things, ie. the residential energy credit for 2018. I just don't want to get an audit 2 years down the road and then have to fight to get out of a penalty. I think I am going to have the clients, that will be new to me, bring in the Birth Cert. and SS cards like i do all my clients, that way I am covered.
Thanks for all your input,

[Everytax]

continuing, I can see that since it uses language of QUALIFYING child they may have a small leg to stand on because it uses this language in the Due Diligence language for Credits. They may try to imply that we should have used due diligence in filing the EIP form

[Rapid Robert]

TurboTax is now offering a site for this as well. https://turbotax.intuit.com/stimulus-check/

What seems to be coming more clear is that only returns with REFUNDS that used direct deposit will use that banking information for EIP checks. If you had a balance due and used direct debit (EFW), apparently that is not sufficient to meet the "IRS has your bank info" requirement. Thanks a lot IRS for all the lack of clarity and slap-dash nature of this (getting info first from vendors instead of directly from IRS). Didn't the IRS itself say they'd provide a site? What if citizen doesn't want to give their personal data to Intuit or a tax professional (who may likely want to charge them, since they won't be a regular customer)?

[dtlee]

What seems to be coming more clear is that only returns with REFUNDS that used direct deposit will use that banking information for EIP checks.

Do you have any cite for this? I do not see any reason why they cannot use that information. I am hoping that they will.

Regarding the place where the information can be supplied, the IRS has been promising this "in the coming weeks" since 3/30:

The IRS does not have my direct deposit information. What can I do?

In the coming weeks, Treasury plans to develop a web-based portal for individuals to provide their banking information to the IRS online, so that individuals can receive payments immediately as opposed to checks in the mail.

Information should be here when they have the site available:
https://www.irs.gov/newsroom/economi...u-need-to-know

[Rapid Robert]

Do you have any cite for this? I do not see any reason why they cannot use that information. I am hoping that they will.

None from the IRS, which is a real failure on their part. The Tax Institute at H&R Block stated this in their weekly tax update bulletin yesterday, and this article also uses this language. "Up to 70 million people who have given the IRS their bank information to receive prior tax refunds will see the money in their bank account by April 15, Patricia McLaughlin, a spokeswoman for the Treasury Department, told The Washington Post."

https://www.businessinsider.com/pers...deposit-2020-4

TurboTax says, "If you had a balance due, or if you opted to receive your refund by mail, the IRS will mail your stimulus check to the address on your return."

[dtlee]

Thank you. I guess I can hope that the interpretations are wrong. I have no idea what the IRS is doing (apparently, neither do they).

[Burke]

I'm betting TTB and HRB simply stated what is correct if a TP sent a check for any balance due. I would think the IRS could use direct debit information since that would be in their records. And they didn't think it was necessary to say so specifically in that particular case. Things are having to ramp up faster than usual with no input from the public or tax preparation community in order to expedite processing.

[TaxGuyBill]

The law specifically directs the payments to go into bank accounts that have had tax REFUNDS or other government payments. It is silent on what to do if the IRS has bank information for withdrawals. So that is why most quotes say "refund" because that is what the law says.

I have not heard any 'official' word if the will use bank accounts that had withdrawals. Although it seems logical to do that, I haven't seen anything official. However, the IRS has announced that the website for entering or updating your bank information should be available by the end of the month, so it seems likely they will clarify it by then (the website for those not required to file tax returns is supposed to launch tomorrow, but the other one isn't supposed to come until later this month).