Earned Income Credit-Form 8867

[zeros]

I was in a seminar recently and I believe the speaker said that on the 8867 form, that we would have to manually fill this out as opposed to having the software automatically fill it out like last year. IRS, apparently, has decided to be quite strict in regards to auditing returns with EIC on them; hence, this year in order for EIC to generated the proper due diligence forms must be completed. Anybody else heard this?

[Golden Rocket]

Yes

Just got back from a seminar where guest speaker was one of the IRS people.

He said that a study showed 80% of Form 8867 preparers did not individually answer the questions. A few preparers did not know what a Form 8867 was.

He did NOT state that software was mandated to cease the default population of the form.

[joanmcq]

What software by default populates the form? Mine GENERATES the form, but I gotta check the boxes.

[ChEAr$]

8867 procedures

What software by default populates the form? Mine GENERATES the form, but I gotta check the boxes.

So does mine (Taxwise). Also fills in names, etc, but got to check the boxes.

Since it is a paid preparer form I do not print it out for client copy, but leave it on the computer since no separate signatures are required.

[thomtax]

Drake will fill out the 8867 form. I think the reasoning is this:
1. If I have typed in a ss# for the dependent, it can safely assume that they have a ss card.
2. When I put the birthdate into the program, it is safe to calculate the age.
3. By inputing information that they are dependents, it is safe to check the boxes that they are dependents.
4. Since the number of months lived in home is input, it can assume which box to check.
5. Since the income has been put in for calculating the taxes, the computer can determine that the income is in the proper range and check the box.

Also, I print the forms off and have each filer sign and date the forms that they are correct.

LT

[erchess]

Since I went out on my own

I have not had a client who qualified for the Earned Income Credit. I continue to study the requirements in case I ever need to know them but the fact that I refuse to offer RALs and the fact that my rates for low end returns are intentionally higher than those of the outfits that emphasize speedy refunds, I have not had one. On the other hand for people in the $50-150K total income range, I am cheaper than those outfits. I tell people that unless they have had a tax lawyer draw up tax shelters of one sort or another, they are not too rich for me to handle.

[joanmcq]

My EIC qualified clients have all been friends returns for the most part. I do offer a discount to members of an organization that helps low income people, but have only gotten a few clients that way, and most of them are elderly, so no EIC anyways.