You make the call By: NATP Research
February 22, 2024

Question: Donna got an IRS letter regarding her level of due diligence when preparing a Form 1040 that included an EIC. The IRS Letter 4858 indicated that Donna may not have met her due diligence requirement and that no action need be taken. The letter went on to state that the IRS would continue to monitor the returns she prepares when credits like the earned income credit, child tax credit, additional child tax credit, credit for other dependents or American opportunity credit and head of household are included. Donna thinks she failed to include Form 8867, Paid Preparer’s Due Diligence Checklist, in a paper-filed return, but she still feels she has met her requirements – should she have gotten a letter?

Answer: Donna may get a letter or other attention from the IRS as part of its educational campaign to ensure that preparers are not fraudulently preparing tax returns with credits for ineligible taxpayers. The IRS has a due diligence education program where it may take several actions when it suspects a credit has not been scrutinized properly.

In addition to sending letters, the IRS might call preparers with questions, or even visit preparers for an “educational office visit.” A preparer who is not following the four tenets of due diligence may face penalties for fraudulent or inattentive preparation under §6695(g).

The due diligence tenets that must be met, including filling out Form 8867, when the above credits (and filing status) are included in a return, are:

  1. Document all questions asked that are needed to verify a claim (know the facts)
  2. Make reasonable inquiries to determine eligibility (compute the credit based on facts)
  3. Complete and submit Form 8867
  4. Keep records for three years (Form 8867 and worksheets)

IRS Publication 4687, Paid Preparer Due Diligence, provides additional details about the four tenets and has examples of what could be judged a lack of due diligence by the IRS. Further, an IRS toolkit for due diligence can be found at The toolkit includes a free due diligence training module and other resources.

Federal tax research
Tax season
Tax professional
Tax preparation
IRS Letter 4858
Tax planning
Tax education
Due diligence
Read more
How to determine a qualifying dependentBy: National Association of Tax Professionals
February 21, 2024

Claiming a child or family member as a dependent can often have significant tax benefits for a taxpayer. For most individual tax returns, determining who qualifies as a dependent of a taxpayer is a straightforward proposition.

However, the question can quickly get complicated in a number of situations tax pros see regularly.

Below, you’ll find a few of the top questions from a recent webinar on the topic and their accompanying answers. If you choose to attend the on-demand version of this webinar, you can access the full recording and the entire list of Q&As.   

Q: Does food eaten outside the home count towards support?

A: Support includes all food you purchase for the child.

Q: If a child was born in December 2023, how should I answer the question: how many months did they live in the home; 12 months or one month?

A: 12 months. A child born during the year is considered to live with the taxpayer for 12 months.

Q: If a child earns enough to support themselves, but saves it all, does that mean that they did not provide more than half their support?

A: Yes, if all the money went into savings, then the child did not spend it on themselves.

Q: Can parents who never marry, and cannot agree who can claim the child, still apply the tiebreaker rule?

A: Yes, if they live together the AGI income tiebreaker rule would apply.

To learn more about determining qualifying dependents, you can watch our on-demand webinar. NATP members can attend for free, depending on membership level! If you’re not an NATP member and want to learn more, join our completely free 30-day trial at 

Tax education
Tax preparation
Tax planning
Tax season
Read more
Unlocking the magic of the tax industry: join us at Taxposium 2024 By: National Association of Tax Professionals
February 19, 2024

Calling all tax pros! Get ready to embark on an unforgettable journey filled with education, inspiration and networking opportunities at Taxposium 2024. Hosted by the National Association of Tax Professionals (NATP), this premier in-person tax education conference is set to take place from July 22-24 at the enchanting Walt Disney World Dolphin Resort in Orlando, Florida.

Elevate your tax knowledge

Taxposium is designed to cater to professionals of all levels, whether you’re a seasoned expert or just starting your career in tax. Our carefully curated lineup of educational sessions covers a wide range of tax and business topics, from the latest technology & business trends to the latest in tax changes. Earn valuable CPE credits while expanding your expertise and getting ahead of the competition. PLUS: Taxposium registrants can attend our winter TaxCon online education event for free and earn additional CPE!

Experience the magic of collaboration:

At Taxposium, you’ll have the opportunity to connect with fellow tax professionals from across the country to forge new relationships, exchange ideas and gain fresh perspectives in a collaborative and supportive environment. Whether you’re looking to expand your professional network or seek mentorship from industry veterans, Taxposium offers the perfect platform to foster meaningful connections.

Unwind and recharge:

After the hustle and bustle of tax season, it’s essential to take time for yourself to have some fun. Taxposium is the perfect balance of education and relaxation. With additional features to make sure all attendees’ needs are met, we’re proud to announce our Zen Den and mother’s room. It’s a top priority that all attendees feel comfortable and welcome.

Engage and explore:

Step into the lively Expo Hall and discover a world of innovation, resources and inspiration. Engage with industry-leading vendors, explore cutting-edge technology, and take advantage of exclusive discounts and offers. Indulge your taste buds with delicious snacks and refreshments and challenge your fellow attendees to friendly games and activities.

Make it a family affair:

Looking to combine business with pleasure (and take a vacation you can partially write off as a business expense)? Taxposium offers the perfect opportunity to bring the whole family along. With its close proximity to Walt Disney World, you can extend your stay and immerse yourself in the magic of the ‘happiest place on earth’. Create lifelong memories with your loved ones while enjoying the ultimate tax professional experience.

Event highlights:

  • Welcome Reception: Kick off Taxposium with a bang at our Welcome Reception on day one. Mix and mingle with fellow attendees, enjoy delicious hors d’oeuvres, and get ready for an action-packed event filled with excitement and camaraderie.

  • Educational sessions: Choose from a diverse array of educational sessions led by industry experts, covering topics ranging from individual and business taxation to ethics and compliance. Gain valuable insights, practical tips and actionable strategies to elevate your tax practice.

  • Networking opportunities: Connect with peers, mentors and industry leaders. Share experiences, exchange ideas and build relationships that will propel your career forward.

  • Family-friendly activities: Make the most of your time in Orlando with family-friendly activities and attractions. From thrilling rides and character encounters to world-class dining and entertainment, there’s something for everyone to enjoy at Walt Disney World. PLUS: Taxposium attendees can purchase discounted tickets for themselves and their family members!

Don’t miss out:

Join us at Taxposium 2024 and unlock the magic to having the best tax season yet! Register now to secure your spot at this must-attend event and take your tax career to new heights. With a blend of education, inspiration and fun, Taxposium promises an unforgettable experience. We can’t wait to welcome you to Orlando and make memories that will last a lifetime.

For more information and to register, visit To be updated when the full agenda is finalized, enter your email at We’ll see you in July!

Tax education
Tax professional
Read more

About NATP

Whether you’re a tax professional just starting out in your career or an experienced expert, NATP believes in you and the work you do to help your clients. We take pride in providing you with resources you won’t find anywhere else, and helping you succeed in the ever-growing and changing industry.

As tax laws change, you can rely on NATP for professional advocacy within the government, guidance on how to apply updated federal tax code to your clients’ unique situations and relationships with communities of other tax professionals to help foster your career. Explore NATP.

If you’re a taxpayer looking for an expert to help you with your tax planning and preparation, look to the industry’s top preparers. Choose an NATP member.

Additional Articles

Navigating the Corporate Transparency Act: your guide to BOI reporting in 2024February 16, 2024
You make the call February 15, 2024
A closer look at recent guidance on pension-linked emergency savings accounts February 14, 2024