TAP A03-019

Improvement of Form 8862

Statement of Issue:

The Form 8862, Information to Claim Earned Income Credit After Disallowance, is completed by a taxpayer whose earned income credit was reduced or disallowed in a prior year to show eligibility for claiming the credit for the current year.

Proposal:

The EITC committee performed a line by line analysis of the current Form 8862 for the purpose of making specific recommendations for clarifying and simplifying the form to reduce taxpayer burden. In addition, the EITC proposed IRS reduce the form to a checkbox statement on Schedule EIC since the form is used neither for examination nor submission processing. The committee also recognized the large number of math errors created by taxpayers not filing the Form 8862 with their EITC claim and recommended steps IRS should take to increase awareness of the filing requirement.

Response Notes:

Gerbore informed the Committee that the revised Form 8862, which mirrored the Committee’s recommendations, was presented to publishing and Chief Counsel, but neither liked the revision. Unfortunately Counsel felt the form duplicated a lot of the information asked on the tax return and contained in Publication 596 and the instruction booklets. Committee will review revised Form 8862 when available.