Reaching Out to Preparers

Outreach and education is the first step of in our strategy to improve the accuracy of EITC claims. It is our most important tool to help you prepare high quality EITC claims. Our focus is letting you know about available resources and helping you understand your due diligence responsibilities.

Letters to Preparers

The last step in our outreach and educational part of our tiered EITC Preparer Compliance program is letters directed to specific preparers. We look at the number of returns with a high likelihood of EITC errors completed by the same preparer. And, we send letters to preparers who have a high number of these returns. The letters:

• Acknowledge that we believe the preparer submitted inaccurate returns
• Pinpoint the primary issues identified as questionable on the returns
• Highlight the consequences of filing inaccurate EITC claims
• Outline EITC due diligence responsibilities
• Provide tips on preparing accurate returns and points to online EITC tools, information and other resources
• Inform preparer that we are monitoring their future returns

Return Preparers who file returns with EITC errors or questionable claims may receive one or more of the following letters (Click on any of the letters listed below to view the letter in Adobe Reader format. You can download the latest version of Adobe Acrobat Reader FREE on the Adobe's Web site):

• Letter 5025, You may have violated tax law by submitting inaccurate returns. Primary issues identified are qualifying children who don't meet the relations or residency requirements and questionable income and expenses on Schedule C
• Letter 5025-C, You may have violated tax law by submitting inaccurate returns. Primary issue identified is questionable income and expenses on Schedule C
• Letter 5025-Q, You may have violated tax law by submitting inaccurate returns. Primary issue identified is questionable qualifying children who don't meet the relations or residency requirements 

Additional Steps

We send the letters to help preparers file accurate EITC claims in the future. We do not assess penalties against preparers because of the letters, but monitor returns filed by these preparers to ensure accuracy improves. If there is no improvement, we may follow-up with phone calls, additional letters or due diligence visits. See the additional resources links below for more information on the additional steps.

Click here for more information on the consequences of non-compliance.

Additional Resources Links (click on any topic listed below for additional information on the subject):

• EITC Preparer Information on irs.gov
• Consequences of Filing EITC Returns Incorrectly
• EITC Preparer Compliance - Targeted, Tailored and Tiered
  • Visiting Preparers Filing Highly Questionable Returns
  • Real Time EITC Preparer Pilot
  • Auditing for Due Diligence Compliance
  • Barring Non-Compliant EITC Preparers from Filing Tax Returns
  • Additional Forceful Actions Taken Against Return Preparers Filing False EITC Claims

Educational Opportunities for Avoiding EITC Error

This Return Preparer Toolkit has a wealth or resources:

• An online training course to help you refresh your EITC tax law and due diligence knowledge is available in English and Spanish. This course may qualify for continuing education for you. Click here for the Due Diligence Training Module.
• Our Schedule C and Record Reconstruction Training module  helps you meet your due diligence requirements while preparing returns with self-employment income and provides tips for helping your clients reconstruct their business records.
• Our popular Due Diligence Videos help you avoid common EITC error situations and are fun to watch.
• Visit the Frequently Asked Questions part of this site. Your colleagues have asked IRS numerous questions related to EITC. Our answers will guide you to the right answer for similar situations.
• And more, follow the headings on the left navigation bar for more tips and tools to help you avoid EITC error. 

Last updated: 10/24/2012