IRS Fires Off EITC Warnings

The IRS is now sending letters to preparers who are suspected of filing inaccurate EITC claims.

The letters pinpoint the primary issues identified on the returns, explain the consequences of filing inaccurate claims for the EITC, and advise preparers that the IRS will continue monitoring the types of EITC claims they file.

"Based on a recent internal review, a large number of 2011 tax returns you prepared with Earned Income Tax Credit (EITC) contained errors," a sample warning letter begins. One group of letters begins "You may have violated tax law by submitting inaccurate returns."

The letters pinpoint the primary issues identified on the returns and warn of future monitoring. The sample letter also details preparers' duties regarding proper filing for EITCs, including due diligence.

The sample letter also points out an online IRS toolkit for EITCs. A primer for individuals is also available.