New Law, Proposed Regs Heighten EITC Preparer Due Diligence

Journal of Accountancy, January 2012 | Go to article overview

New Law, Proposed Regs Heighten EITC Preparer Due Diligence


The Sec. 6695(g) penalty for failure by preparers to exercise due diligence with respect to the earned income tax credit (EITC) increased from $100 to $500 effective for returns required to be filed after Dec. 31, 2011.

The measure was enacted in late October as part of the U.S.-Korea Free Trade Agreement Implementation Act of 2011, P.L. 112-41. The EITC penalty applies to each failure of a tax return preparer to exercise due diligence in determining taxpayer eligibility for or the amount of an EITC.

Also in October, the IRS proposed regulations (REG-140280-09) that would add new due-diligence requirements and procedures for the refundable credit. Existing regulations (Regs. Sec. 1.6695-2) require preparers to complete Form 8867, Paid Preparer's Earned Income Credit Checklist, or to otherwise record the information it requires for each return claiming the EITC and keep it in the preparer's records. The checklist must be based on information provided by the taxpayer to the preparer or otherwise reasonably obtained by the preparer.

The proposed regulations would require preparers to submit Form 8867 with the tax return on which the EITC is claimed and would not allow any substitute for the form. Return preparers would also be required to keep a copy of the form and of any document that the taxpayer supplied and the preparer relied upon to complete Form 8867. Return preparers would be required to retain this information for three years from the return due date (without regard to any extension) or the date the return or claim for refund was filed, whichever is later. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited article

New Law, Proposed Regs Heighten EITC Preparer Due Diligence
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this article
  • Highlights & Notes
  • Citations
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.