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2016

Department of the Treasury

Internal Revenue Service

Instructions for Form 8867

Paid Preparer’s Due Diligence Checklist for the Earned Income Credit (EIC), the

Child Tax Credit (CTC)/Additional Child Tax Credit (ACTC), and/or the American

Opportunity Tax Credit (AOTC)

Section references are to the Internal Revenue Code unless

Only paid tax return preparers should complete this form. If

otherwise noted.

you were paid to prepare a return for any taxpayer claiming the EIC,

Future Developments

the CTC/ACTC, and/or the AOTC, you must complete Form 8867

and meet the other due diligence requirements described in

For the latest information about developments related to Form 8867

Purpose of

Form, later.

and its instructions, such as legislation enacted after they were

Form 8867 must be filed with the return. Form 8867 must be

published, go to

filed with the taxpayer’s return or amended return claiming the EIC,

What’s New

the CTC/ACTC, and/or the AOTC.

Signing tax return preparers.

Form 8867 expanded and revised. Due to changes in the law, the

If you are the paid tax return preparer signing the return and you

paid tax return preparer EIC due diligence requirements have been

are filing the return electronically, file the completed Form 8867

expanded to also cover the CTC/ACTC and the AOTC.

electronically with the return.

Form 8867 has been modified to account for these changes. In

If you are the paid tax return preparer signing the return and you

addition, Form 8867 has been streamlined. Completing the form is

are not electronically filing the return, provide the completed Form

not a substitute for actually performing the necessary due diligence

8867 to the taxpayer with instructions to file this form with his or her

and completing all required forms and schedules when preparing

return.

the return.

If you are the paid tax return preparer signing the return and you

are mailing the return to the IRS for the taxpayer (which should only

Penalty now indexed for inflation. The paid tax return preparer

be done after the taxpayer has reviewed and signed the paper

due diligence penalty is now indexed for inflation. Therefore, the

return), mail the completed Form 8867 to the IRS with the return.

penalty for failure to meet the due diligence requirements with

respect to returns and claims for refund filed in 2017 is $510 per

Nonsigning tax return preparers. If you are the paid tax return

credit per return.

preparer for any of the credits covered by Form 8867 but you are not

required to sign the return as preparer, provide the signing tax return

Refunds issued after February 15, 2017. Due to changes in the

preparer the completed form in either electronic or paper format.

law, the IRS cannot issue refunds before February 15, 2017, for

You can find rules regarding who is a signing tax return preparer

returns that claim the EIC or the ACTC. This applies to the entire

and a nonsigning tax return preparer in Regulation section

refund, not just the portion associated with these credits. You should

301.7701-15. If you are the only paid tax return preparer for the

inform the taxpayer if his or her return includes a claim for the EIC

taxpayer’s return, you are the signing tax return preparer and must

and/or the ACTC.

sign the return as preparer. Failure to sign the return when required

Reminders

may subject you to a penalty.

Multiple Forms 8867 for one return. Form 8867 must be

No retroactive claims of the EIC. Due to changes in the law, if the

completed by a paid tax return preparer responsible for a taxpayer's

taxpayer didn't have an SSN by the due date of his/her 2016 return

claim of the EIC, the CTC/ACTC and/or the AOTC; therefore, there

(including extensions), he/she can't claim the EIC on either an

may be multiple Forms 8867 for one return or amended return. Only

original or an amended 2016 return, even if he/she later gets an

one Form 8867 may be filed. If there are multiple Forms 8867, file

SSN. Also, if a child didn't have an SSN by the due date of the

the Form 8867 prepared by the signing tax return preparer. If there

taxpayer's return (including extensions), the taxpayer can't count

are multiple Forms 8867, but none were prepared by the signing

that child as a qualifying child in figuring the EIC on either an original

return preparer, file the Form 8867 covering the EIC, or if none, the

or an amended 2016 return, even if that child later gets an SSN.

CTC. All Forms 8867 must be retained as provided in

Document

No retroactive claims of the CTC/ACTC or the AOTC. Due to

Retention.

changes in the law, if the taxpayer didn't have an SSN (or ITIN) by

Example 1. Paid tax return preparer A determined taxpayer T's

the due date of his/her 2016 return (including extensions), he/she

eligibility for, and amount of, the EIC claimed on T's return. Paid

can't claim the CTC/ACTC or the AOTC on either an original or an

preparer B determined T's eligibility for, and amount of, the AOTC

amended 2016 return, even if he/she later gets an SSN (or ITIN).

claimed on T's return and also signs the return as the signing tax

Also, no CTC/ACTC or AOTC is allowed on an original or an

return preparer. Two Forms 8867 must be completed, one prepared

amended 2016 return with respect to a child who didn't have an

by A for the EIC, and one prepared by B for the AOTC. The Form

SSN, ATIN, or ITIN by the due date of the return (including

8867 completed by B as the signing preparer should be filed with T's

extensions), even if that child later gets one of those numbers.

return.

If the taxpayer applies for an ATIN or an ITIN on or before the due

Example 2. The facts are the same as Example 1, except B

date of his/her 2016 return (including extensions) and the IRS issues

does not sign the return as the signing tax return preparer. The Form

the taxpayer an ATIN or an ITIN as a result of the application, the

8867 completed by A, which covers the EIC, should be filed with T's

IRS will consider the ATIN or ITIN as issued on or before the due

return.

date of the return.

Purpose of Form

General Instructions

As a paid tax return preparer, you are required to exercise due

diligence when preparing any client’s return or claim for refund. As

Form 8867 covers the EIC, the CTC/ACTC, and/or the AOTC. You

part of exercising due diligence, you must interview the client, ask

should only complete columns corresponding to credits actually

adequate questions, and obtain appropriate and sufficient

claimed on the taxpayer’s return that you prepared.

information to determine the correct reporting of income, claiming of

Nov 22, 2016

Cat. No. 59407V

Instructions For Form 8867 - Paid Preparer'S Due Diligence Checklist For The Earned Income Credit (Eic), The Child Tax Credit (Ctc)/additional Child Tax Credit (Actc), And/or The American Opportunity Tax Credit (Aotc) - 2016

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