Preparers Must File Checklist on EITC Eligibility Under Proposed Rules

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Beginning in 2012, tax preparers will be required to file a due diligence checklist with any federal return claiming the Earned Income Tax Credit, IRS says. The step is being proposed due to concern over improper payment of the credit, IRS says in the proposed rules (REG-140280-09). The proposed amendment to the tax preparer penalty final rules issued in December 2008 would mean Form 8867 (Paid Preparer's Earned Income Credit Checklist) would be required to be filed with the tax return or claim for refund claiming the earned income credit. Currently tax preparers are only required to go through the form to determine EITC eligibility and then keep it on file.

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