IRS Warns of Delays with Schedule 8812 and Form 8867

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By Frank Byrt

The IRS is warning tax preparers of possible delays in processing tax returns or issuing refunds for two different forms – Schedule 8812, Child Tax Credit, and Form 8867, Paid Preparer’s Earned Income Credit Checklist – because either they have been prepared incorrectly or are incomplete.
 
In a QuickAlerts e-mail sent by the IRS to professional tax preparers on February 11, the IRS said, “We have observed instances in which the Schedule 8812 is attached to form 1040 and 1040A and is not filled out correctly. These instances are causing downstream processing delays.” 
 
The IRS said it has experienced the following two conditions on Schedule 8812:
  • The Schedule 8812 Part 1 checkboxes A, B, C, and D are checked when taxpayers list a dependent child with a Social Security number qualifying for child tax credit. 
  • The Schedule 8812 Part 1 checkboxes A, B, C, and D not being checked when taxpayers have a child with an Individual Taxpayer Identification Number (ITIN) on Form 1040 and 1040A line 6c identified as qualifying for the child tax credit in column 4.
The Schedule 8812 instructions direct the taxpayer to: "Use Part I of Schedule 8812 to document that any child for whom you entered an ITIN on Form 1040, line 6c; Form 1040A, line 6c; or Form 1040NR, line 7c; and for whom you also checked the box in column 4 of that line, is a resident of the United States because the child meets the substantial presence test and is not otherwise treated as a nonresident alien."
 
The IRS said it is working to implement business rules to reject the incorrectly completed returns. In the interim, the IRS is requesting that developers of tax software packages include an alert to help preparers identify inconsistencies when completing Schedule 8812 to help avoid delays in processing returns.
 
In a separate QuickAlerts e-mail sent to tax professionals on February 4, the IRS said it "has noticed that a large number of returns with the Form 8867, Paid Preparer's Earned Income Credit Checklist, have incomplete information. Although the IRS will not reject a return if information is missing on Form 8867, these returns will be suspended causing a potential delay in refunds if the information is missing."
 
The IRS goes on to say, "We are asking software developers and transmitters to communicate the Form 8867 information requirements through their software and other communication channels. Specifically, when Form 8867 is present in a return and Earned Income Credit is claimed, entries for lines 22, 23, 24, 25, both parts of 26, and 27 must be present. We recommend that the software ensures these lines on Form 8867 have entries in order to avoid processing delays that could impact refunds."
 
In addition, the IRS is asking software companies to remind preparers they could be assessed a penalty if they fail to comply with due diligence requirements on returns claiming the Earned Income Credit.
 
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I havent got my check this is some stright bullshit and i filed on jan30 th

ageee my return was accepted om 1/31 and the site says still processing

Having the same problem. I fille on jan 10th still have not heard a thing.

Tax prep. Says I was accepted early feb. here more than a month later I'm feeling stupid. IRS really screwing things up.

I filled on 01/19 and STILL NOTHING!! they said I should receive a direct deposit date BEFORE March 14th!!! seriously?????

Wow! This is just craziness. Ive been anxiously checking everyday in hopes of getting a direct deposit date on the irs website and still nothing. I filed on 1/18. it is now 2 months later. wtf?

This article is quite funny because I submitted my 8863 online which was prepared at a school and submitted thru them. All the lines you list for the EIC on form 8863 were filled out and they still have not processed it not one of the items listed is missing. I keep checking online and it just lists processing so I call and am told it will take two extra weeks to process from the 21 days. We shall see but I smell B.S. from the IRS.

How can Government /media let this happen? If it was their $ they would not stand for it.They are hurting my children by not processing my taxes.

I'm first time filer and received after 3 1/2 months that Schedule 8812 is missing, my bad may be my tax filer did not filed or something wrong.

What did you do? Did you post/fax the 8812 with any other forms?