TAP A03-018

Changes to Form 8867

Statement of Issue:

The EITC Issue Committee was asked to provide feedback on Form 8867, Paid Preparer's Earned Income Credit Checklist, which was developed to help preparers meet the due diligence requirements of Internal Revenue Code section 6695(g). Some preparers are unaware of the due diligence requirements and others find Form 8867 difficult to use.

Proposal:

The committee recommends IRS make more preparers aware of the due diligence requirements through specific changes to forms and publications , those dealing with EITC directly as well as those frequently used by tax practitioners, such as Publication 1045, Tax Professionals Guide to Federal Tax Products. In addition, the committee suggested line by line changes to the form to make Form 8867 user friendly. The committee also recommended increased compliance visits to preparers to insure preparers are complying with the law. The EITC Committee recommended that IRS solicit best practices from EITC preparers when revising this form.

Response Notes:

Recommendations resubmitted in 2005 at program owner's request see TAP E05-002