Meeting Due Diligence Requirements: An Analysis of Form 8867 for Tax Practitioners

Locate and read through Form 8867, Paid Preparer’s Due Diligence Checklist, found in the Supporting Materials section. You will be asked to specifically address items on the form and to expand on the expectations of the tax preparer in meeting the due diligence requirements outlined in Form 8867.
Specifically, you must address the following rubric criteria:
Introduction
Describe the requirements of tax practitioners relating to due diligence in 1–2 paragraphs.
Knowledge Requirement
Explain how a tax practitioner can satisfy the knowledge requirement discussed on Form 8867.
Document Retention Record Keeping Requirement
Describe the type of documentation relied upon to complete Form 8867 and any accompany worksheets relating to applicable tax credits or HOH filing status.
Inquiry Level – Reasonable Inquiries
Explain the types of inquiries that should be made to complete Form 8867 with proper due diligence.
Consider discussing the credit-specific (and filing status-specific) questions noted on Form 8867.
Consequences
Explain the potential consequences of not meeting due diligence requirements.
Discuss any monetary or nonmonetary consequences.
Conclusion
Discuss the importance of Form 8867 and due diligence required of tax practitioner in 1–2 paragraphs.
What to Submit
Submit your short paper as a 3- to 5-page Microsoft Word document with double spacing, 12-point Times New Roman font, and one-inch margins. Use the Module Three Assignment Template. Sources should be cited according to APA style.
Resources
https://www.eitc.irs.gov/tax-preparer-toolkit/preparer-due-diligence/what-is-form-8867/what-is-form-8867
https://www.eitc.irs.gov/
https://www.irs.gov/tax-professionals/office-of-professional-responsibility-and-circular-230