The Earned Income Credit (EIC) is a refundable tax credit that has a significant impact on United States revenue and, in the 2022 tax year, amounted to about $64 billion claimed by more than 31 million tax filers.
In a recent year, 153.8 million individual federal tax returns were filed, and 19.6 million—12.7% of individual taxpayers—claimed the Earned Income Credit. Based on that percentage, it would not be unexpected that any tax return preparer will prepare the tax returns for many EIC claimants.
Course Publication Date:
February 21, 2024
This course is available with
NO ADDITIONAL FEE if you have an active
self study membership or
all access membership or can be purchased for
$30.00!
| Author: | Paul Winn |
| Course No: | TAX-EITC-3034 |
| Recommended CPE: | 3.00 |
| Delivery Method: | QAS Self Study |
| Level of Knowledge: | Overview |
| Prerequisites: | None |
| Advanced Preparation: | None |
| Recommended Field of Study: | Taxes
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Learning Objectives
- Recognize the EIC eligibility rules that apply to all taxpayers.
- Identify the EIC eligibility rules applicable to taxpayers who have a qualifying child.
- List the EIC eligibility rules that apply to taxpayers who do not have a qualifying child.
- Recognize how the EIC for which an eligible taxpayer qualifies is determined.
- Recognize the incidence of errors in claiming the earned income credit and their probable causes.
- Identify the estimated impact of earned income credit errors on federal revenue.
- List the most common earned income credit errors and their potential problem areas.
- Recognize the additional questions tax preparers need to ask if taxpayer-provided information appears incorrect, inconsistent or incomplete.
- List the principal tools used by the IRS to verify the propriety of EIC claims and to prevent or recover improper EIC payments.
- Identify the additional requirements imposed on taxpayers claiming the EIC following disallowance.
- Recognize the exceptions applicable to the requirement that a taxpayer file IRS Form 8862 following disallowance of an EIC claim.
- Determine the year in which an IRS Form 8862 must be filed to claim EIC after the IRS has disallowed it.
- Recognize the duration of the prohibition against filing for the EIC in the event a taxpayer’s EIC error is determined to be the result of reckless/intentional disregard of EIC rules or fraud.
- List the due diligence requirements a tax return preparer must meet when preparing a tax return claiming the earned income credit.
- Recognize the records a tax return preparer is required to keep to support a client’s claim for the earned income credit.
- Identify the penalties that may be imposed on a tax return preparer for failing to comply with due diligence requirements when preparing a client’s tax return claiming the earned income credit.
- Identify the sanctions that may be imposed on an employer whose employee fails to comply with EIC due diligence requirements.