filing 2003 1040 -- no tax owed

[jainen]

this bartender didn't know

>>Am I correct to think that the IRS wouldn't have a problem with this<<

I don't think so, and I don't think it will make you look very good either. The IRS will certainly have a problem with a non-filer suddenly claiming unrecorded income solely to get EIC. They might not do anything about it, but then again they might do plenty, such as coming after you as well as her.

I don't even think your client will appreciate it. Until the 1099 tripped her up she preferred to stay under the radar. Do you suppose that was because this bartender didn't know about income tax?

[Snaggletooth]

Incredible, but

Skateboard, it seems incredible, but the attitude of the Washington crowd
including the IRS is that they absolutely LOVE giving out earned income credit.

They know that it can be abused, but the only pressure coming from them to
stop the abuse appears to be forcing more and more requirements on tax
preparers rather than getting off their butt into the field and throwing some of
these cheaters in jail.

[Skate1968]

Client is a low-income single Mom, head of household. Has not filed in years. Not W2s or 1099s. This was the first year that she received a 1099 for a while.

My plan:
File her 2003 tax return late before 4-17-07. Estimate her modest income from bar tending and report it on her 1040. This should get her an Earned income credit. It should make me look good. No tax will be owed so no penalty for filing late.

Am I correct to think that the IRS wouldn't have a problem with this as long as my estimate of her income is reasonable? (the woman is not wealthy. I have no reason to think she's hiding income. She's never mentioned trying to get a refund from her 2003 1040. this is entirely my idea)


Again, sincere thanks to everyone who has shared their professional opinions with me.