Man Allegedly Falsified Returns to Maximize EITC
The Justice Department announced that it has asked a federal court in Chicago to bar Bruce E. Grant and his business, Quick Check Limited, from preparing tax returns. The civil injunction suit alleges that Grant falsifies customers' income on their tax returns, frequently by fabricating business income and expenses, in order to claim the maximum earned income tax credit (EITC) for them.
Preventing EITC Errors
Clients who claim income from self-employment without a Form 1099 should be asked if they have records to support the computation of their income. This may require the preparer to ask probing questions, particularly if clients claims they have no records to support the numbers they give you.
- She has no Form 1099.
- She was self-employed cleaning houses.
- She earned $12,000.
- She had no expenses related to the cleaning business.
- Do you have records of the amount of money you received from house cleaning?
- How much did you charge to clean a house?
- How many houses did you clean?
- Who provided the cleaning supplies?
- If you provided the cleaning supplies, how much did you spend weekly?
- Did you provide your own transportation to the houses you cleaned?
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