The IRS is sending due diligence letters to preparers who may be noncompliant in meeting due diligence requirements and who completed questionable refundable credit claims.

These letters are sent to raise awareness of questionable returns and assist preparers in meeting due diligence requirements. The IRS will continue to monitor the refundable credit returns prepared in the upcoming filing season to see if the quality of the preparers’ returns improves.

Preparers who completed highly questionable refundable credit claims may receive one of the following letters:

  • 5025, for preparers who have not have met EITC due diligence requirements on returns with questionable qualifying children and self-employment income;
  • 5025-A, for preparers who may not have met the due diligence requirement on returns claiming the AOTC;
  • 5025-B, for preparers who may not have met the due diligence requirements on returns claiming Child Tax Credit and Additional Child Tax Credit;
  • 5025-E, for preparers who may not have met the EITC due diligence requirements on a high number of returns claiming the EITC;
  • 5025-H, for preparers who may not have met the EITC due diligence requirements on returns reporting income received as a household employee.

For more, visit the Tax Preparer Toolkit on IRS.gov.

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Jeff Stimpson

Jeff Stimpson

Jeff Stimpson is a veteran freelance journalist who previously served as editor of The Practical Accountant.