Educational letters and telephone calls focus on helping paid preparers comply with the due diligence requirements and prepare accurate returns and claims for refund claiming the:
- Earned income tax credit (EITC),
- Child tax credit (CTC), additional child tax credit, (ACTC), credit for other dependents (ODC),
- American opportunity tax credit (AOTC) and
- Head of household (HOH) filing status.
Educational letters and Telephone Calls
We send letters to preparers who have submitted returns claiming the above tax benefits with a high likelihood of errors or who fail to include Form 8867, Paid Preparer's Due Diligence Checklist.
Each letter to a preparer reminds them that not meeting due diligence requirements can result in a penalty assessed against the preparer of $560 per failure (up to $2,240 per return) for returns and claims for refund filed in 2023. It can also result in audits of clients' returns or a due diligence audit of the preparer. We continue to monitor the preparer's future returns claiming the tax benefits to which due diligence requirements apply.
We send letters to preparer's clients to inform them their return may contain errors claiming the above tax benefits.
We make telephone calls to preparers who have received one of our letters and continue to appear to file returns with errors claiming the above tax benefits. We review due diligence rules and discuss possible consequences for not meeting those rules.
The calls are exempt from directives on IRS not contacting taxpayers by telephone. We will ask questions to confirm the preparer's identity, but we will not discuss specific client information or ask the preparer to disclose client information.
Return preparers and their clients may receive the letters described below.
Pre-Filing Season Educational Letters
Letter 5025 (English-Spanish), You May Not Have Met Your Due Diligence Requirements
We send this letter to paid preparers who may not have met due diligence requirements on returns and claims for refund filed for their clients last year.
Letter 6138 (English-Spanish), You Need to Make Sure your Tax Return is Accurate
We send this letter to the clients of a paid preparer to inform clients their return may contain errors claiming the EITC, CTC/ACTC/ODC, AOTC or HOH filing status. It provides tips for selecting a paid preparer.
It advises the taxpayer to review the return for errors in claiming the above tax benefits, and to file Form 1040x, Amended U.S. Individual Income Tax Return, to correct any errors found.
Letter 5138 (English-Spanish), Return Preparer Client Audit Notification
We send this letter to advise a prepare we are auditing their clients' returns. It reminds the preparer that not meeting due diligence requirements can adversely affect the preparer and their clients.
Filing Season Educational Letters
Letter 4858 (English-Spanish), You May Not Have Met Your Due Diligence Requirements
We send this letter to paid preparers who may not have met due diligence requirements on returns and claims for refund filed for their clients this year.
Letter 5364 (English-Spanish), Missing Form 8867
We send this letter to paid preparers who failed to include Form 8867, Paid Preparer's Due Diligence Checklist, on non-electronic returns filed for their clients this year.
What Should I Do if I Received and Educational Letter or Telephone Call?
If you get a letter from us, don’t ignore it. Review your return preparation procedures to make sure you consistently meet all four due diligence requirements. If the accuracy of the returns you prepare doesn't improve, you may be subject to additional steps described below.
If there is no improvement in the accuracy of returns you prepare, we may follow-up with an in-person educational visit or due diligence compliance audit. See "Additional Resources" below for more information on these steps.
- Consequences of Not Meeting Your Due Diligence Requirements
- Preparer Compliance - Focused and Tiered
The Tax Return Preparer Toolkit Can Help You Avoid Errors
In the Toolkit, we provide education and resources to help paid preparers strengthen due diligence practices and avoid errors.
- Take the online Due Diligence Training Module, to help you refresh your tax law and due diligence knowledge. The training is available in English and Spanish and may qualify you for continuing education credit.
- Learn how to meet your due diligence requirements while preparing returns with self-employment income using our Schedule C and Record Reconstruction Training. Plus, get tips on helping your clients reconstruct their business records.
- View the popular Due Diligence Videos to help you improve your due diligence interview process.
- Attend our due diligence webinars or the annual Nationwide Tax Forums.
- View archived Nationwide Tax Forum Videos at no cost.
- Visit our Frequently Asked Questions page for more guidance.