2 Credits: Taxes
The Earned Income Tax Credit (ETIC) is a refundable tax credit that has a significant impact on United States revenue. It is also the source of a disproportionately large number of errors in tax returns in which a claim for it is made. In a recent year, 150.3 million individual federal tax returns were filed, and more than 27.4 million—18.2% claimed the Earned Income Credit0F. Based on that percentage, it would not be unexpected that, in the years ahead, approximately one taxpayer in every five will claim the EIC. Approximately 70% of federal income returns claiming the earned income credit are prepared by professional tax return preparers.
This course briefly summarizes the earned income credit rules, examines the common errors committed when claiming the credit, discusses the EIC due diligence requirements imposed on professional tax return preparers, and identifies the sanctions to which preparers and their employers may be subject for a failure to meet expected due diligence requirements.
 SOI Tax Stats-Individual Income Tax Returns may be accessed at: http://www.irs.gov/uac/SOI-Tax-Stats-Historical-Table-1.
Upon successful completion of this course, participants will be able to:
- Identify the earned income tax credit eligibility rules that apply to all taxpayers, including taxpayers who have a qualifying child and taxpayers without a qualifying child
- List the most common earned income tax credit errors and their potential problem areas
- Identify the additional questions tax preparers need to ask if taxpayer-provided information appears incorrect, inconsistent, or incomplete
- List the due diligence requirements a tax return preparer must meet when preparing a tax return claiming the earned income tax credit
- Identify the records a tax return preparer is required to keep to support a client’s claim for the earned income tax credit
- Identify the penalties that may be imposed on a tax return preparer for failing to comply with due diligence requirements when preparing a client’s tax return claiming the earned income tax credit
- Cite the sanctions that may be imposed on an employer whose employee fails to comply with EITC due diligence requirements
- Identify the additional requirements imposed on taxpayers claiming the EITC following disallowance and the exceptions to those requirements
June 21, 2023
There are no prerequisites.
IRS Provider Number: 0MYXB
IRS Course Number: 0MYXB-T-02242-22-S
IRS Federal Tax Law Credits: 2
CTEC Course Number: 2071-CE-1061
CTEC Federal Tax Law Credits: 2
CFP Notice: Not all courses that qualify for CFP® credit are registered by Western CPE. If a course does not have a CFP registration number in the compliance section, the continuing education will need to be individually reported with the CFP Board. For more information on the reporting process, required documentation, processing fee, etc., contact the CFP Board. CFP Professionals must take each course in it’s entirety, the CFP Board DOES NOT accept partial credits for courses.
CTEC Notice: California Tax Education Council DOES NOT allow partial credit, course must be taken in entirety. Western CPE has been approved by the California Tax Education Council to offer continuing education courses that count as credit towards the annual “continuing education” requirement imposed by the State of California for CTEC Registered Tax Preparers. A listing of additional requirements to register as a tax preparer may be obtained by contacting CTEC at P.O. Box 2890, Sacramento, CA, 95812-2890, by phone toll-free at (877) 850-2832, or on the Internet at www.ctec.org.
Meet The Experts
Paul J. Winn CLU ChFC is a writer with more than 30 years experience in the life insurance and securities industry as an agent/registered representative, an agency head, a marketing vice president for a life insurance company and the president of a corporate registered investment adviser. He was a long serving member of the advisory board to the New York State insurance department. He is a published book author and creator of more than 200 taxation, insurance and securities training courses.