Publication 596 |
2000 Tax Year |
Chapter 5 Disallowance of the EIC
If your earned income credit (EIC) for any year after 1996
was denied (disallowed) or reduced by the IRS, you may need to
complete an additional form to claim the credit for
2000.
This chapter is for people whose earned income credit
(EIC) for any year after 1996 was denied or reduced by the IRS. If
this applies to you and you want to claim the credit for 2000, you may
need to complete and attach
Form 8862, Information To Claim
Earned Income Credit After Disallowance, to your 2000 return.
This chapter explains when you need to attach Form 8862.
This chapter also explains the rules for certain
people who cannot claim the EIC for a period of years because their
EIC was denied or reduced.
Form 8862
If your EIC for any year after 1996 was denied or reduced for any
reason other than a mathematical or clerical error, you must attach a
completed Form 8862 to your next tax return if you wish to claim the
EIC. The date on which your EIC was denied and the date on which you
file your 2000 return affect whether you need to attach Form 8862 to
your 2000 return or to a later return. The following examples
demonstrate whether Form 8862 is required for 2000 or 2001.
Example 1. Form 8862 required for 2000
You claimed the EIC on your 1999 tax return, which you filed in
March 2000. The IRS questioned the EIC, you were unable to support
your claim, and, in September 2000, you received a statutory notice of
deficiency telling you that an adjustment would be assessed unless you
filed a petition in the Tax Court within 90 days. You did not act on
this notice within 90 days. Therefore, your EIC was denied in December
2000. If you wish to claim the EIC on your 2000 return, you must
complete and attach Form 8862 to your return.
Example 2. Form 8862 required for 2001
The facts are the same as in Example 1, except that you
received the statutory notice of deficiency in February 2001. Because
the 90-day period referred to in the statutory notice is not over when
you are ready to file your return for 2000, you should not attach Form
8862 to your 2000 return. However, if you wish to claim the EIC for
the year 2001, you must complete and attach Form 8862 to your return
for that year.
Exception for mathematical or clerical errors.
If your EIC was denied or reduced as a result of a mathematical or
clerical error, do not attach Form 8862 to your next tax return. For
example, if your arithmetic is incorrect, the IRS can correct it. If
you do not provide a correct social security number, the IRS can deny
the EIC. These kinds of errors are called mathematical or clerical
errors.
Omission of Form 8862.
If you are required to attach Form
8862 to your 2000 tax return, and you claim the EIC without attaching
a completed Form 8862, your claim will be automatically denied. This
is considered a mathematical or clerical error. You will not be
permitted to claim the EIC without a completed Form 8862.
Additional documentation may be required.
You may have to provide IRS with additional documentation before a
refund relating to the EIC you claim is released to you even if you
attach a properly completed Form 8862 to your return.
Are You Prohibited From Claiming the EIC for a Period of
Years?
If your EIC for any year after 1996 was denied and it was
determined that your error was due to reckless or intentional
disregard of the EIC rules, then you cannot claim the EIC for the next
2 years. If your error was due to fraud
, then you cannot claim the EIC for the
next 10 years. The date on which your EIC was denied and the date on
which you file your 2000 return affect the years for which you are
prohibited from claiming the EIC. The following examples demonstrate
which years you are prohibited from claiming the EIC.
Example 3. Cannot claim EIC for 2 years
You claimed the EIC on your 1999 tax return, which you filed in
March 2000. In October 2000, the IRS denied your claim and determined
that your error was due to reckless or intentional disregard of the
EIC rules. You cannot claim the EIC for tax year 2000 or 2001. If you
wish to claim the EIC on your return for 2002, you must complete and
attach Form 8862 to your return for 2002.
Example 4.
The facts are the same as in Example 3, except that the
IRS did not disallow your 1999 EIC until after you filed your 2000
return. You cannot claim the EIC for tax year 2001 or 2002. If you
wish to claim the EIC on your return for 2003, you must complete and
attach Form 8862 to your return for 2003.
Example 5. Cannot claim EIC for 10 years
You claimed the EIC on your 1999 tax return, which you filed in
February 2000. In December 2000, the IRS denied your claim and
determined that your error was due to fraud. You cannot claim the EIC
for tax years 2000 through 2009. If you wish to claim the EIC on your
return for 2010, you must complete and attach Form 8862 to your return
for 2010.
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